The Public Interest Business Protection Tax (PIBPT) introduced in the Finance Act 2022 is intended to act as a deterrent for large companies seeking to monetise valuable assets that may cause energy supply companies to cease trading. Falling foul of this legislation carries a 75% tax charge.

This is a freeview 'At a glance' guide to Public Interest Business Protection tax (PIBPT).

The escalation of energy costs and the rise in energy supply companies entering Insolvency prompted the government to implement a new temporary tax measure.

  • Energy is a traded commodity with companies entering into derivative contracts to hedge market fluctuations.
  • Where contracts have been entered into for a price lower than the current market value, this provides a valuable asset for those companies.
  • In some groups, these contracts can be held in a separate company from the company that supplies energy to consumers.
  • The government has recognised a structural risk wherein a company might opt to capitalise on the value of these contracts for its own gain or for the benefit of its shareholders. Consequently, this could lead to the collapse of an energy supply company.

The legislation is a temporary measure covering the period of 28 January 2022 to 30 April 2024 (extended from 28 January 2023 by Statutory Instrument 2022/1321). This legislation may be further extended in length or extended to cover other public interest businesses by the government. 

The legislation is aimed at large companies and groups with combined assets, that would otherwise be subject to this tax, of over £100 million, the legislation applies when:

  • A person holds an asset to be used for the benefit of a public interest business (carried on by itself or a connected party). Public interest business currently means an energy supply business. This is the 'qualifying purpose'.
  • Steps are taken by that person that result, to some extent, in that asset no longer being available to the business. These are the 'disqualifying steps'.
  • These steps materially contribute to the public interest business going into special measures or significantly increase the business' costs.
  • The person was aware (or ought to have been aware) that this may have been the consequence of the steps.

If the  legislation applies: 

  • A tax will be imposed at 75% of the adjusted value of the asset.
  • The adjusted value is the underlying value of the asset less 10%.
  • If a person becomes liable, they must submit a return within 30 days of the later of:
    • The date they became liable.
    • When the public interest business went into special measures.
    • When the £100 million condition is satisfied.
    • Royal Assent of Finance Act 2022 on 24 February 2022.
  • Payment is due within 15 days of the filing date.
  • There is joint and several liability for the tax due on the person taking the steps, Associated companies and shareholders who have received the benefit of the asset.

The legislation is retrospective from 28 January 2022.


As highlighted in the Parliamentary debate and by the Chartered Institute of Taxation (CIOT) and Association of Taxation Technicians (ATT) in submissions, this is a 25-page long piece of legislation that has never been seen before. It was introduced at the Report Stage with no "prior announcement, no consultation, little debate" and requiring MPs to vote within 48 hours. The government acted as it recognises that Ofgem cannot react quickly enough and this draws the question "Why it is easier to create and impose a new tax than it is to enforce regulatory body actions?"

Useful guides on this topic

How do you wind up (liquidate) a company? What types of liquidation are there? What are the formalities and the tax consequences of liquidation?

Associated companies
This guide considers the associated company tests in CTA 2010 section 27. This section was repealed with effect from 1 April 2015 and is now only relevant where an accounting period straddles or ends before that date.

External links

TIIN: Public Interest Business Protection Tax

HMRC Technical Note: Public Interest Business Protection Tax

Explanatory Note: Public Interest Business Protection Tax

Small print

The legislation is found at Schedule 10 Finance Act 2022


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