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A1.111 UK territorial waters

There are special provisions¹ in respect of activities in UK territorial waters and the UK part of the Continental Shelf.

These involve an extension in the territorial jurisdiction of UK tax law which previously had generally been limited to the land surface of England and Wales, Scotland and Northern Ireland. This is achieved first by regarding UK territorial waters as part of the UK and, secondly, by treating those activities carried out on the UK part of the Continental Shelf over which the UK has jurisdiction (ie exploration and exploitation of the sea bed and subsoil and their natural resources) as carried on in the UK.

For the purposes of income tax, capital gains tax and corporation tax the territorial waters of the UK up to the 12 mile limit are to be regarded as part of the UK². The 12 mile limit was established from 1 October 1987 pursuant to the Territorial Sea Act 1987 and SI 1987/1270.

In this part of the legislation a number of special terms are used