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HMRC commissioned Ipsos to conduct a qualitative evaluation of the Oil and Gas First Year Capital Allowances for plant and machinery. �

The qualitative evaluation was carried out between February and June 2022 with 13 claimant companies of the Oil and Gas First Year Allowance (FYA) for plant and machinery.  �

FYA is a capital allowance for expenditure by oil and gas companies on plant and machinery operating in the ring fence which allows 100% of qualifying expenditure on plant and machinery wholly for use in such exploration or extraction to be deducted in the year the expenditure is incurred when calculating taxable profits. �

The evaluation looked at 4 broad areas including impact, experience of claiming, appropriateness and proportionality of the relief and the claims process.