OT30380 - Capital gains: valuation of oil assets including shares: rebasing to 31 March 1982
»Ê¹ÚÌåÓýapp need for valuations at 31 March 82 first arose from the introduction of indexation by FA85\S68 and continues as a result of rebasing under FA88.
High oil prices in 1982 often mean that asset values at 31 March 1982 were higher than original cost. As a result, the combination of a high rebased cost and indexation may result in chargeable gains being materially reduced or indeed the creation or augmentation of losses.
»Ê¹ÚÌåÓýapp kink test and the loss rules for oil industry assets disposed of after 21 January 1990 will normally reduce any allowable losses.
»Ê¹ÚÌåÓýapp high oil price in 1982 in relation to the late 1970s is a major factor affecting the comparison between the value of licences and their cost as at 31 March 1982.