Document ID: chunk:federal_register_of_legislation:C2004A00844:clause:1_6:p9
Version: federal_register_of_legislation:C2004A00844
Segment Type: clause
Provision Reference: sch 1 cl 6 (pt 9/18)
Character Range: 136257–139362

of sections

Operative provisions

40‑730 Deduction for expenditure on exploration or prospecting
40‑735 Deduction for expenditure on mining site rehabilitation
40‑740 Meaning of ancillary activities and mining building site
40‑745 No deduction for certain expenditure
40‑750 Deduction for payments of petroleum resource rent tax
40‑755 Environmental protection activities
40‑760 Limits on deductions from environmental protection activities
40‑765 Non‑arm's length transactions

[This is the end of the Guide.]

Operative provisions

40‑730  Deduction for expenditure on exploration or prospecting

 (1) You can deduct expenditure you incur in an income year on *exploration or prospecting for *minerals, or quarry materials, obtainable by *mining operations if, for that expenditure, you satisfy one or more of these paragraphs:
 (a) you carried on mining operations;
 (b) it would be reasonable to conclude you proposed to carry on such operations;
 (c) you carried on a *business of, or a business that included, exploration or prospecting for minerals or quarry materials obtainable by such operations, and the expenditure was necessarily incurred in carrying on that business.

 (2) However, you cannot deduct expenditure under subsection (1) if it is expenditure on:
 (a) development drilling for *petroleum; or
 (b) operations in the course of working a mining property, quarrying property or petroleum field.

 (3) Also, you cannot deduct expenditure under subsection (1) to the extent that it forms part of the *cost of a *depreciating asset.

 (4) Exploration or prospecting includes:
 (a) for mining in general, and quarrying:
 (i) geological mapping, geophysical surveys, systematic search for areas containing *minerals (except *petroleum) or quarry materials, and search by drilling or other means for such minerals or materials within those areas; and
 (ii) search for ore within, or near, an ore‑body or search for quarry materials by drives, shafts, cross‑cuts, winzes, rises and drilling; and
 (b) for petroleum mining:
 (i) geological, geophysical and geochemical surveys; and
 (ii) exploration drilling and appraisal drilling; and
 (c) feasibility studies to evaluate the economic feasibility of mining minerals or quarry materials once they have been discovered; and
 (d) obtaining *mining, quarrying or prospecting information associated with the search for, and evaluation of, areas containing minerals or quarry materials.

 (5) Minerals includes *petroleum.

 (6) Petroleum means:
 (a) any naturally occurring hydrocarbon or naturally occurring mixture of hydrocarbons, whether in a gaseous, liquid or solid state; or
 (b) any naturally occurring mixture of:
 (i) one or more hydrocarbons, whether in a gaseous, liquid or solid state; and
 (ii) one or more of the following: hydrogen sulphide, nitrogen, helium or carbon dioxide;
whether or not that substance has been returned to a natural reservoir.

 (7) Mining operations means:
 (a) mining operations on a mining property for extracting *minerals (except *petroleum) from their natural site; or
 (b) mining operations for