Navigation path


Generic Tax Name Corporate income tax - Petroleum revenue tax
Tax name in the national language Petroleum revenue tax (PRT)
Tax name in English Petroleum revenue tax (PRT)
Member State UK-United Kingdom
Tax in force since 1975/01/01
If abolished, date on which the tax ceases to apply
Business version date 2015/01/01
Version date 2015/02/17
This file was last updated on

Type of tax
Direct taxes Personal income tax
Corporate income tax
Other

Indirect taxes VAT
Excise duty (EU harmonised)
Alcoholic beverages
Energy products and electricity
Manufactured tobacco
Other

Social security contribution Employers
Employees
Other
 
Legal base

Oil Taxation Act 1975, Petroleum Revenue Tax Act 1980 and Oil Taxation Act 1983, as amended by annual finance acts.

 
Who sets
The tax rate is set by




The tax base is set by




The reliefs are set by




Comments
 
Beneficiary





Comments
 
Geographical Scope

UK

 
Taxpayers
Domestic-source income of non-resident entities is Taxed
Not Taxed
Comments
 
Tax object and basis of assessment
As general rule, taxable income under corporate income tax includes also








Comments

Income considered Domestic income
Worldwide income (subject to double-tax relief)
Comments

Comments

Assessments are made on the difference between incomings (known in the legislation as "positive amounts") and expenditure (known as "negative amounts") for a field.

Incomings include three main items: the gross profits arising from disposals of oil and gas produced by each participator in each chargeable period, tariff receipts and disposal receipts.

In addition to relief for field‑related expenditure, various other reliefs and allowances are often available. Some of these are described below.

The participator's share of the assessable profit or allowable loss for the field in each chargeable period, each chargeable period being a period of six months ending on 30 June or 31 December each year. PRT is a field‑based tax and each field is assessed in isolation although certain "cross‑field" allowances are available.

 
Deductions, Allowances, Credits, Exemptions
Valuation of inventory
System First-in first-out (FIFO)
Last-in first-out (LIFO)
Average cost
Specific identification (unit method)

Comments

Depreciation rules
 
Buildings
System Straight-line method
Declining balance
Production method
Combination of above
Other
Not-depreciable

Comments
Average depreciation period
Average depreciation rate
 
Movable (tangible) assets
System Straight-line method
Declining balance
Production method
Combination of above
Other
Not-depreciable

Comments
Average depreciation period
Average depreciation rate
 
Movable fixed assets
System Straight-line method
Declining balance
Production method
Combination of above
Other
Not-depreciable

Comments
Average depreciation period
Average depreciation rate
 
Intangible assets
System Straight-line method
Declining balance
Production method
Combination of above
Other
Not-depreciable

Comments
Average depreciation period
Average depreciation rate
 
Land (if any)
System Straight-line method
Declining balance
Production method
Combination of above
Other
Not-depreciable

Comments
Average depreciation period
Average depreciation rate


Comments

Are there limits to interest deductions? Yes No
If yes:
Definition of deduction limit

Comments

Is there an Allowance for Corporate Equity? Yes No
If yes:
Notional rate applied for allowance

Comments

Losses
Loss carry-forward exists? Yes No
If yes:
Time limit: Indefinite
 
Size limit:
 
Loss carry-backward exists? Yes No
If yes:
Time limit: Indefinite
 
Size limit:
 

Comments


Comments

Gas sold under a pre June 1975 contract with a former monopoly supplier is exempt from PRT. There are various other reliefs - see “special features” below.

 
Rate(s) Structure
Nominal corporate income tax rate Rate: 35.00 %

Central government surcharge Rate:
Regional government surcharge Rate:
Local government surcharge Rate:
Combined rate (all-in rate) Rate: 35.00 %


Comments

The PRT rate was changed form 50% to 35% effective for chargeable periods ending after December 2015.


Special tax rate for SMEs
Special tax rates apply to SMEs: Yes No
If yes:
Nominal corporate income tax rate Rate:
Central government surcharge Rate:
Regional government surcharge Rate:
Local government surcharge Rate:
Combined rate (all-in rate) Rate:


Comments
 
International aspects
Treaty countries Non-treaty countries
 
Repatriated profits are taxed according to the following system Exemption system Exemption system
Tax credit Tax credit
Deduction Deduction
 
Interest received is taxed Yes No Yes No
Tax rate on interest received
Outgoing dividends withholding tax
Outgoing interest payments withholding tax
 
Foreign losses can be set-off Yes No Yes No
If yes:
Minimum direct or indirect shareholding to qualify loss-offset (if applicable)
 
Loss carry-forward exists? Yes No Yes No
If yes:
Time limit: Indefinite
 
Indefinite
 
Size limit:
 
Loss carry-backward exists? Yes No Yes No
If yes:
Time limit: Indefinite
 
Indefinite
 
Size limit:
 
Controlled foreign company (CFC-)rules exist? Yes No Yes No
If yes:
Time limit: Indefinite
 
Indefinite
 
Size limit:
 
Threshold for capital or voting power held directly or indirectly by resident in non-resident company
CFC-rules apply if foreign tax rate is lower than
CFC-rules apply for passive income only? Yes No Yes No

Comments   Treaty countries

Comments   Non-treaty countries
 
Measures against profit shifting
 
Do Thin Capitalization (TC) rules exist? Yes No
If yes:
Date of first introduction
Introduced as Explicit TC law
Part of CIT law
Test for TC Ratio
Arm's length
If ratio
Value of numerical ratio:
Definition numerator
Definition denominator
 
Debt considered for test Internal
Internal and external
TC depends on shareholding? Yes No
Substantial shareholding threshold
 
Type of shareholding Direct
Indirect
Automatic remedy Yes No
Remedy Non-deductibility of interest
Reclassification as dividend
 
Rules apply to All companies
Foreign companies
Non-EU companies
Transfer pricing rules exists? Yes No
If yes:
Arm’s length principle applied? Yes No
 
Remedy Fee
Tax base increase
 
Tax due date

Thirty days after the issue of a tax assessment subject to earlier instalment and advance payments.

 
Tax collector

By assessment and a system of instalments and advance payments.

 
Special features

If the chargeable period is one in which safeguard relief applies then, after PRT has been calculated in the normal way - taking account of all allowances and reliefs - a safeguard calculation is made.

"Safeguard" limits the PRT charge in each chargeable period to not more than 80 % of the amount (if any) by which field profit exceeds 15 % of the cumulative capital expenditure at the end of that period. "Safeguard" applies up to break‑even point and for half as many periods again.

 

Special reliefs:

The following are the main reliefs available to set against participators' profits in a taxable field:

"Uplift" - because interest and loan costs are not allowable for PRT, these costs are reflected in a relief known as "uplift" or "supplement", which is an addition of 35 % to, broadly, certain capital expenditure. In order to qualify for supplement the expenditure must have been incurred for specific purposes, including bringing a field on‑stream or substantially improving the rate of production or transportation.

"Oil allowance" provides PRT exemption to each participator for a certain amount of oil from each field in a chargeable period. The allowance per period is 125,000, 250,000 or 500,000 metric tonnes depending on the location of the field and the date on which it was given development consent. There is a cumulative limit over the life of the field of 20 times the allowance per period.

Subject to various restrictions, relief can also be given for certain exploration and appraisal expenditure, unrelieved field losses, limited oilfield development and general research expenditure incurred in different fields.

 
Economic function







Comments
 
Environmental taxes



Comments
 
Tax revenue
ESA95 code d51b

Year
Annual tax revenue (millions)
Currency
Tax revenue as % of GDP
Tax revenue as % of total tax revenue
2012 2,106.00 GBP 0.13
2011 1,775.00 GBP 0.11
2010 1,349.00 GBP 0.09
2009 1,047.00 GBP 0.07
2008 2,663.00 GBP 0.17
2007 1,387.00 GBP 0.09
2006 2,546.00 GBP 0.18
2005 1,799.00 GBP 0.14
2004 1,166.00 GBP 0.09
2003 1,146.00 GBP 0.10

Comments