The Chancellor delivered Budget 2020 today.
The Budget contained no significant changes to direct North Sea taxation and confirmed that RF rates would remain unchanged. There was no announcement in respect of the transformational sector deal that had been included in the Conservative Manifesto.
Announcements that may be of interest include:
- Confirmation that the main rate of corporation tax is to remain at 19 per cent, rather than reduced to 17% from 1 April 2020 as previously enacted. This is significant and has been costed as increasing the tax take by over £30bn in the forecast period;
- The main rate of Research and Development Expenditure Credit to increase from 12% to 13%. We assume that the ring-fence RDEC rate of 49% will remain;
- The introduction of a requirement from 2021 to notify HMRC where an “uncertain tax treatment” has been taken in submitted computations. The rules are only to apply to large companies with the size limits seemingly matching the Senior Accounting Officer regime (relevant balance sheet total exceeding £2bn and/or a turnover exceeding £200m);
- The previously announced changes for off-payroll workers and the 50% restriction to using carried forward CGT losses are included.
A largely welcome Budget for the industry with thankfully no surprises.
CW Energy LLP
11 March 2020