The most significant assessable receipts that arise from a petroleum project are from the commercial recovery of petroleum. These are referred to as assessable petroleum receipts. They generally arise when recovered petroleum is sold before it is processed or after some preliminary processing has been undertaken.
Certain other kinds of receipts are also assessable under the petroleum resource rent tax (PRRT). Broadly, these receipts are assessable to ensure there is symmetry in the PRRT as they generally arise from amounts that have been previously claimed as a deduction. For example, the proceeds received from the disposal of property used in a petroleum project are assessable as the original purchase is deductible under the PRRT.
There is no revenue or capital distinction in the PRRT. Therefore, receipts of a revenue or capital nature may be assessable under the PRRT.
Assessable receipts derived in relation to a petroleum project must be taken into account in the financial year in which they are receivable or, in certain cases, when they are deemed to be receivable.
As assessable receipts are derived when they are receivable or deemed to be receivable, they may be derived before the project commences (that is, before a production licence comes into force) or after it has ceased.
Broadly, in the case of onshore petroleum projects and the North West Shelf project, assessable receipts that are derived from 1 July 2012 will be assessable. However, where a taxpayer has chosen the look-back approach to determine their starting base, certain assessable receipts may be derived before 1 July 2012.
Also, where an onshore petroleum project or the North West Shelf project receives a payment before 1 July 2012 for petroleum or a marketable petroleum commodity not recovered or produced until after 30 June 2012, the receipt will be taken to have been derived after 30 June 2012, when the recovery or processing activity is undertaken.
Last Modified: Friday, 15 March 2013