MINERALS RESOURCE RENT TAX ACT 2012 (REPEALED)

CHAPTER 3 - MRRT ALLOWANCES  

PART 3-5 - STARTING BASE ALLOWANCES  

Division 90 - Declines in value of starting base assets  

Subdivision 90-B - Base values under the book value approach  

SECTION 90-25   INITIAL BASE VALUE  
Working out the initial base value of a starting base asset

90-25(1)    
The base value of the * starting base asset , for the * MRRT year in which the * start time for the asset happens, is:

(a) if at all times between 2 May 2010 and 30 June 2012 the * entity that * held it also had the mining project interest (or held the * pre-mining project interest from which the mining project interest * originated ), and subsection (2) applies to the mining project interest - the sum of:

(i) the initial book value of the asset under subsection (3) or (4) (whichever is applicable); and

(ii) the sum of the valuation amounts under subsection (6) for amounts of * interim expenditure incurred in relation to the asset (other than amounts of interim expenditure incurred in relation to acquiring or bringing into existence another starting base asset); or

(b) if paragraph (a) does not apply - the sum of the valuation amounts under subsection (6) for amounts of interim expenditure in relation to the asset.

Note:

Initial base values are separately assessed under Division 155 in Schedule 1 to the Taxation Administration Act 1953 . Those assessed values are used in working out starting base allowances in all assessments of MRRT liabilities: see item 15 of Schedule 4 to the Minerals Resource Rent Tax (Consequential Amendments and Transitional Provisions) Act 2012 .

90-25(2)    
This subsection applies to a mining project interest if:

(a) the mining project interest existed (or is a part of a mining project interest that existed) just before 2 May 2010; or

(b) the mining project interest * originates from a * pre-mining project interest that existed (or that is a part of a pre-mining project interest that existed) just before 2 May 2010.

Initial book value of a starting base asset

90-25(3)    
If:

(a) the value of the asset is recorded in the accounts from which the most recent audited financial report before 2 May 2010 was prepared; and

(b) the financial report relates to a financial period that ended in the 18 months preceding that day;

the initial book value of the asset is as follows:

where:

accepted value
is:

(a) the value recorded in those accounts, unless paragraph (b) applies; or

(b) if that value is inconsistent with an auditor ' s report on the financial report - a value that is consistent with the auditor ' s report.

long term bond rate for the initial valuation period
is the * long term bond rate for the initial valuation period under subsection (5) .

n
is the number of days in the initial valuation period, divided by 365.

90-25(4)    
Despite subsection (3) , the initial book value of the asset is zero if the value of the asset is not recorded as mentioned in subsection (3) .

Note:

If the asset is mine development expenditure, it will not have an initial book value.

Initial valuation period for a starting base asset

90-25(5)    
The initial valuation period for the asset is the period:

(a) starting:

(i) on the date of the most recent audited financial report, prepared before 2 May 2010, from the accounts in which the value of the asset is recorded, unless subparagraph (ii) of this paragraph applies; or

(ii) if the value of the asset recorded in those accounts is inconsistent with an auditor ' s report on the financial report - on the date of the auditor ' s report; and

(b) ending at the end of the * MRRT year in which the * start time for the asset happens.

Valuation amounts for interim expenditure

90-25(6)    
If the * entity that * held the asset incurred an amount of * interim expenditure relating to the asset, the valuation amount for the amount of interim expenditure in relation to the asset is:

where:

long term bond rate for the interim valuation period
is the * long term bond rate for the interim valuation period under subsection (7) .

n
is the number of days in the interim valuation period, divided by 365.

Interim valuation period for interim expenditure

90-25(7)    
The interim valuation period for an amount of * interim expenditure is the period:

(a) starting on the day on which the * entity incurred the amount; and

(b) ending at the end of the * MRRT year in which the * start time for the asset happens.