21 Feb 088 PRRT and income tax: treatment of geosequestration expenditure and receipts - TR 2008/D2This draft Taxation Ruling was released on 20 February 2008 for public comment by 4 April 2008. Its full title is "Petroleum resource rent tax and income tax: treatment of geosequestration expenditure and receipts".
The draft Ruling considers the circumstances when expenditure and receipts related to geological sequestration are deductible expenditure and assessable receipts respectively for the purposes of ascertaining taxable profit under the PRRTAA and so ascertaining liability for PRRT. The draft Ruling also describes income tax consequences of expenditure on geological sequestration generally (that is, not just in relation to PRRT projects) under ss 8-1, 40-735 (mining site rehabilitation) and 40-755 (environmental protection activities) and also more generally under Division 40 of the ITAA 1997. Geological sequestration (also known as geosequestration) refers to the long-term storage of material in underground geological formations such as oil and gas fields, unworkable coal beds and deep saline formations.
For a copy of TR 2008/D2, go here