OT13910 - PRT: non-field expenditure - disallowable expenditure

Interaction of Non-Field Expenditure with OTA75\S3(4)

Under OTA75\S5(4) certain costs cannot be allowed as allowable abortive exploration expenditure. »Ê¹ÚÌåÓýapp provision is applied to exploration and appraisal expenditure by virtue of OTA75\S5A(4).

»Ê¹ÚÌåÓýapp provision (with appropriate modifications) picks up OTA75\S3(4) (see OT09450) by disallowing

  1. interest or any other expenditure incurred in obtaining a loan or any other form of credit,
  2. the cost of acquiring any land or interest in land other than the cost of making to the Secretary of State a payment falling within OTA75\S3(1)(b), see OT09075,
  3. the cost of acquiring or erecting any building or structure on land,
  4. any payment made for the purpose of obtaining a direct or indirect interest in oil won or to be won from any area whatsoever, other than a payment made to the Secretary of State.

»Ê¹ÚÌåÓýappre is no similar provision for research expenditure in OTA75\S5B; as none of the categories listed above could ever be construed as ‘researchâ€� within the normal English language meaning of the term, there is no need for one.