19 Jan 15 Exposure draft: Resource project realignment and farm-out legislation
Treasury advises that in the 2013-14 Budget measure limiting the immediate deductibility of expenditure on mining rights and mining information, there was a provision that the measure did not prevent the immediate deductibility of mining rights acquired under a ‘farm-in, farm-out’ arrangement (the partial exchange of a tenement interest in exchange for the farmee providing exploration services as consideration).
The Government subsequently announced in the 2014-15 Budget that the limited immediate deductibility would also not result in a tax liability on mining rights acquired under tenement ownership realignments within a common development project.
Treasury has now released for public consultation an exposure draft of legislation and draft explanatory memorandum that seek to give effect to the announced measures.
The closing date for submissions is Friday 6 February 2015.