Petroleum Resource Rent Tax Assessment Act 1987

Sch 1 heading substituted by No 18 of 2012, s 3 and Sch 4 item 46, effective 1 July 2012. The heading formerly read:

SCHEDULE - PROVISIONS RELATING TO INCURRING AND TRANSFER OF EXPLORATION EXPENDITURE ON OR AFTER 1 JULY 1990

S 31(1) amended by No 21 of 2015, s 3 and Sch 7 item 23, by substituting para (b)(ii), effective 20 March 2015. No 21 of 2015, s 3 and Sch 7 item 24, contains the following application provision:

24 Application of amendment  
24
Item 11 of Schedule 6 to the Tax Laws Amendment (2013 Measures No 2) Act 2013 (the earlier application provision ) applies in relation to the amendment made by item 23 of this Schedule in a corresponding way to the way the earlier application provision applies in relation to the amendment made by item 9 of that Schedule.

Para (b)(ii) formerly read:

(b)(ii) if section 41 applies to the expenditure - the company taken under paragraph 41(1)(b) to have incurred the liability for making the expenditure held the loss interest in the transferring entity.

31(2A) inserted by No 88 of 2013, s 3 and Sch 7 item 143, effective 1 July 2012.

S 31 substituted by No 78 of 2006, s 3 and Sch 2 item 2, effective 1 July 2006. No 78 of 2006, s 3 and Sch 2 items 3 and 4 contain the following application provisions:

3 Application - years of tax that start on or after 1 July 2006  
3
The amendments made apply only in relation to instalments and assessments of tax under the Petroleum Resource Rent Tax Assessment Act 1987 for financial years that start on or after 1 July 2006. 4 Application - pre-1 July 2006 expenditure  
(1)
Transferable exploration expenditure that was actually incurred before 1 July 2006 may, unless subitem (2), (3) or (4) applies, be transferred in relation to a transfer year that starts on or after 1 July 2006 from one company (the loss company ) to another company (the profit company ) in relation to a petroleum project (the receiving project ) in which the profit company holds (or has held) an interest (the receiving interest ).

(2)
The expenditure cannot be transferred if new clause 31, or any other provision of the Petroleum Resource Rent Tax Assessment Act 1987 (as amended by this Act), prevents the transfer

(3)
If the starting day for the receiving project was before 1 July 2006, the expenditure cannot be transferred if old clause 31 would have prevented the transfer of the expenditure, in relation to the transfer year starting on 1 July 2005, from the company which actually incurred the expenditure to the company which held the receiving interest at the end of that year.

(4)
If the starting day for the receiving project was on or after 1 July 2006, the expenditure cannot be transferred if paragraph 31(1)(a) of the old clause 31, subject to subclauses (2), (2AA), (2AB) and (2A) of that clause, did not, in relation to the transfer year starting on 1 July 2005, apply to the company which actually incurred the expenditure.

(5)
If section 41 of the Petroleum Resource Rent Tax Assessment Act 1987 applies to the expenditure, a reference in subitem (3) or (4) to the company which actually incurred the expenditure is taken to be a reference to the company taken under paragraph 41(1)(b) of the Act to have incurred the liability for making the expenditure.

(6)
An expression used in this item has the same meaning as in Part 6 of the Schedule to the Petroleum Resource Rent Tax Assessment Act 1987 .

(7)
In this item:

new clause 31
means clause 31 of the Schedule to the Petroleum Resource Rent Tax Assessment Act 1987 , as amended by Part 1 of this Schedule.

old clause 31
means clause 31 of the Schedule to the Petroleum Resource Rent Tax Assessment Act 1987 , as in force immediately before 1 July 2006.

S 31 formerly read:

RULE - LOSS COMPANY AND PROFIT COMPANY TO HAVE HELD INTERESTS AND BEEN GROUP COMPANIES  
31(1)
Subject to subclauses (2), (2AA), (2AB), (2A), (3) and (4), the loss company may only transfer the expenditure to the profit company in relation to the receiving project and the transfer year if:

(a) the loss company held an interest in relation to the transferring entity at all times from the beginning of the financial year in which the expenditure was incurred to the end of the transfer year; and

(b) the profit company held an interest in relation to the receiving project at all times from the beginning of the financial year in which the expenditure was incurred to the end of the transfer year; and

(c) the profit company was a group company in relation to the loss company and the period starting at the beginning of the financial year in which the expenditure was incurred and ending at the end of the transfer year.

31(2)
Subclause (1) does not require the loss company to have held an interest in relation to the transferring entity at a time before the starting day in relation to the transferring entity.

31(2AA)
If:

(a) the loss company started (whether or not for the first time) to hold an interest in relation to the transferring entity during the financial year in which the expenditure was incurred; and

(b) the expenditure was incurred after the time (the farm-in time ) when the loss company started to hold the interest; and

(c) the expenditure was actually incurred by the loss company (rather than taken by section 48 or 48A to have been incurred by the loss company);

subclause (1) does not require the loss company to have held an interest in relation to the transferring entity before the farm-in time.

31(2AB)
If:

(a) at a time (the cessation time ) after the expenditure was incurred and on or after 1 July 1993, the loss company ceased to hold any interest in relation to the transferring entity; and

(b) the cessation did not occur because of a transaction to which section 48 applies;

subclause (1) does not require the loss company to have held an interest in relation to the transferring entity at a time after the cessation time.

31(2A)
Subclause (1) does not require the loss company to have held an interest in relation to the transferring entity at a time after the finishing day in relation to the transferring entity.

31(3)
If the starting days in relation to the transferring entity and the receiving project occurred in the same financial year, subclause (1) does not require the profit company to have held an interest in relation to the receiving project at a time before the starting day in relation to the receiving project.

31(4)
If the starting day in relation to the receiving project occurred in a later financial year than the financial year in which the starting day in relation to the transferring entity occurred:

(a) paragraph (1)(b) does not apply in relation to the transfer of the expenditure; and

(b) the loss company may only transfer the expenditure if (in addition to the requirements in paragraphs (1)(a) and (c)):

(i) the exploration permit by reference to which the starting day in relation to the receiving project is determined was granted to the profit company; and

(ii) the profit company held an interest in relation to the receiving project at all times from the starting day in relation to the receiving project to the end of the transfer year.