Chapter VCM3160

CourtHM Revenue & Customs
Record NumberVCM3160
Published date09 March 2016

ITA07/S192 (1) (ka-kd); ITA07/S303(1) (kb) (kc) (kd)

For shares or holdings issued on or after 6 April 2016, the legislation excludes:

  • generating or exporting electricity or making electricity generating capacity available,
  • generating heat,
  • generating any other form of energy,
  • producing gas or fuel.

These exclusions apply regardless of whether subsidies are received and include activities such as:

  • energy generation or export of electricity that involve storage,
  • the creation of alternative fuels (for example the pelletisation of waste sold for use as fuel),
  • renewable sources of energy generation.

The activities of research and development of innovative generation technologies or the manufacture, production and sale of such technology are not excluded by the legislation.

Similarly, the manufacture of a product that could theoretically be used as a fuel but that was clearly not its intended or normal purpose would not be caught by the exclusion.

ITA07/S198A; ITA07/S309A

Definition of ‘export of electricity’

‘Export of electricity’ is defined as the export of electricity onto a distribution system or transmission system (within the meaning of Section 4 of the Electricity Act 1989).

History of changes to energy generating activities in 2012, 2014 and 2015

Various forms of subsidised energy and specific reserve power generating activities had been excluded by changes to the legislation made in 2012, 2014 and 2015. However, these exclusions have now been superseded by the general exclusion on all energy generating activities.

The changes in 2012, 2014 and 2015 are detailed below for information only:

  1. Excluded activities for shares or holdings acquired on or after 6 April 2012 and before 6 April 2014The generation or export of electricity in respect of which any person received a Feed-in Tariff (FIT) or a similar overseas scheme. Not including trades which...

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