Document ID: chunk:federal_register_of_legislation:C2025C00029:section:4:p24
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 4 (pt 24/95)
Character Range: 5609483–5612235

create will be reduced to sit within the allocation. However, any unused allocation of exploration credits from the preceding year generally would be carried over and so would increase the amount of exploration credits that the explorer can create.
      An exploration credit created by a greenfields minerals explorer can be issued to you if you have invested in the explorer. While the tax offset you receive for the exploration credit issued to you for an income year will apply to that income year generally, the investment that gives rise to that offset may have been made in that or the preceding income year.
      There are rules to ensure that exploration credits are not streamed to some investors rather than others. There are also rules to ensure that the total of the exploration credits you receive because of an investment (whether those credits are issued to you for the year in which you invest or the subsequent year) do not exceed the corporate tax that might be paid by the greenfields minerals explorer on that investment.
      The explorer is liable to pay excess exploration credit tax if the explorer issues exploration credits in breach of these rules.
      There is a cap on total allocations made by the Commissioner for each income year, but if part of the cap from the preceding year is unallocated it generally will be carried over. Allocations are made in the order in which applications for an allocation are made.
      If an exploration credit is issued to a corporate tax entity, it will give rise to a franking credit (rather than a tax offset).
Note: Excess exploration credit tax is imposed by the Excess Exploration Credit Tax Act 2015, and the amount of the tax is set out in that Act.

Subdivision 418‑A—Object of this Division

Table of sections
418‑5 Object of this Division

418‑5  Object of this Division
  The object of this Division is to encourage investment in minerals exploration in Australia by allowing the benefit of losses from minerals exploration to flow to shareholders who share in the risk of the exploration.

Subdivision 418‑B—Junior minerals exploration incentive tax offset

Table of sections

Entitlement to junior minerals exploration incentive tax offset
418‑10 Who is entitled to the tax offset—ordinary case
418‑15 Who is entitled to the tax offset—life insurance company
418‑20 Entitlement of member of a trust or partnership to a share of exploration credits

Amount of junior minerals exploration incentive tax offset
418‑25 The amount of the tax offset
418‑30 Reduced amount of the tax offset for certain trusts

Entitlement to junior minerals exploration incentive tax offset

418‑10  Who is entitled to the tax offset—ordinary case
  You are entitled to a *tax offset for an