INCOME TAX ASSESSMENT ACT 1997

CHAPTER 3 - SPECIALIST LIABILITY RULES  

PART 3-45 - RULES FOR PARTICULAR INDUSTRIES AND OCCUPATIONS  

Division 418 - Exploration for minerals  

Subdivision 418-D - Creating exploration credits  

SECTION 418-80   Meaning of greenfields minerals expenditure  

418-80(1)  
An entity ' s greenfields minerals expenditure for an income year is the sum of:


(a) the amounts of any deductions to which the entity is entitled under section 40-25 for that income year in relation to declines in value that:


(i) are declines in value of *depreciating assets used for *exploration or prospecting for *minerals in an area to which subsection (3) of this section applies; and

(ii) are worked out under subsection 40-80(1) ; and


(b) the amounts of any deductions for that income year to which the entity is entitled in relation to expenditure:


(i) that is of a kind referred to in subsection 40-730(1) ; and

(ii) in relation to which the entity satisfies one or more of paragraphs 40-730(1)(a) to (c) ; and

(iii) that is expenditure on exploration or prospecting for minerals in an area to which subsection (3) of this section applies.

418-80(2)  
For the purposes of subsection (1), disregard a deduction to the extent that it relates to:


(a) matters other than:


(i) declines in value of *depreciating assets used for; or

(ii) expenditure on;
*exploration or prospecting for *minerals in an area to which subsection (3) of this section applies; or


(b) exploration or prospecting for *petroleum or oil shale; or


(c) activities (such as feasibility studies) undertaken to identify the viability of a mineral resource rather than its existence.

418-80(3)  
This subsection applies to an area:


(a) that is in Australia; and


(b) in relation to which the entity *holds a *mining, quarrying or prospecting right at the time of incurring the expenditure, or is the transferee under a *farm-in farm-out arrangement; and


(c) that has not been identified as containing a mineral resource that is at least inferred in a report prepared in accordance with the requirements of:


(i) unless subparagraph (ii) applies - the document that is known as the Australasian Code for Reporting of Exploration Results, Minerals Resources and Ore Reserves and that took effect on 20 December 2012; or
Note:

This document is commonly referred to as the JORC Code (2012 Edition).


(ii) such other document as the regulations prescribe; and


(d) that is not, and is not in, any of the following:


(i) the coastal sea of Australia (within the meaning of subsection 15B(4) of the Acts Interpretation Act 1901 );

(ii) an area referred to in subsection 960-505(2) .

418-80(4)  
For the purposes of paragraph (3)(c), disregard any mineral resource, identified in a report of a kind referred to in that paragraph, that does not include *minerals the *exploration or prospecting for which involved:


(a) use of assets referred to in paragraph (1)(a); or


(b) expenditure referred to in paragraph (1)(b).

418-80(5)  
The Commissioner may request an entity that is a *greenfields minerals explorer in an income year to prepare, within the period specified in the request, a report that:


(a) is of the kind referred to in paragraph (3)(c); and


(b) relates to an area in relation to which the entity has *greenfields minerals expenditure for the income year.

The request may specify the manner in which, and the form in which, the report is to be prepared.


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