OT40550 - Non-Residents Working on the UK Continental Shelf: Scope of Exploration or Exploitation Activities - Meaning of “UK”
Activities carried n within the Territorial Sea
The ordinary meaning of the term “UK” is land comprising England, Wales, Scotland and Northern Ireland. For tax purposes, the meaning is extended by CTA10\S1170, ITA07\S1013 & TGCA92\S276 to include the UK Territorial Sea. The Territorial Sea Act 1987 defines the Territorial Sea as the waters within twelve nautical miles of the shore. In consequence any activity (whether oil and gas related or not) carried on within the twelve mile limit is treated for income tax and corporation tax purposes as if performed on the UK mainland.
Activities carried on within “the UK sector of the continental shelf”
CTA09\S1313(1), ITTOIA05\S874(1) and ITEPA03\S41(1) then provides that any profits or gains from exploration or exploitation activities carried on in the UK sector of the continental shelf (see OT40650), or from exploration or exploitation rights (see OT41001), shall be treated for the purposes of income tax or corporation tax as profits or gains from activities or property in the UK.