Project Pool - Mining Capital Expenditure

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<p >The project pool provisions of Subdivision 40-I allow a taxpayer to deduct, over time, certain capital expenditure associated with a project that qualifies as a project amount under section 40-840.

The Subdivision also ensures that any capital expenditure connected with mining, petroleum and quarrying companies' operations, that was previously able to be deducted under the former Division 330, and not captured by an earlier Subdivision in Division 40 will be captured. In this regard, mining capital expenditure and transport capital expenditure that does not form part of the cost of a depreciating asset and is not deductible under another provision of the Act qualifies as a project amount under subsection 40-840(1) where subparagraphs 40-840(1)(c)(i) or 40-840(1)(c)(ii) is satisfied.

Subparagraph 40-840(1)(c)(i) requires that the mining capital expenditure be <i >directly connected with</i> the carrying on of the mining operations in relation to which the expenditure is incurred, and paragraph 40-840(1)(c)(ii) requires that the transport capital expenditure be directly connected with the carrying on of the business in relation to which the expenditure is incurred. Paragraph 40-730(7)(a) provides that 'mining operations' means mining operations on a mining property for extracting minerals (except petroleum) from their natural site...for the purpose of producing assessable income.

Based on this, subsection 40-840(1) will not only recognise, as project amounts for inclusion in a taxpayer's project pool, capital expenditure amounts</p>

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Project Pool - Mining Capital Expenditure

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