MINERALS RESOURCE RENT TAX ACT 2012 (REPEALED)

CHAPTER 4 - SPECIALIST LIABILITY RULES  

PART 4-1 - MINING PROJECT INTERESTS  

Division 120 - Transferring mining project interests  

Operative provisions  

SECTION 120-10   EFFECT OF MINING PROJECT TRANSFER  
Liability for MRRT moves with interest

120-10(1)    
Any MRRT that would otherwise be payable by a miner in relation to a mining project interest in relation to the part of an * MRRT year before a * mining project transfer happens (the pre-transfer part year ) is payable instead, in accordance with this Division:

(a) by the miner that has the mining project interest after the transfer; and

(b) in the MRRT year for that miner in which the transfer happens.

Note 1:

The MRRT liability for the miner that has the interest after the transfer is worked out in accordance with this Division. It may be more, or less, than the liability the other miner would have had, depending on circumstances such as choices, offsets and available allowances.

Note 2:

For any period after the transfer that the new miner has the interest, its liability for MRRT (if any) is worked out under the ordinary rules.

Note 3:

The miner that has the interest after the transfer may have an additional amount of instalment income in the instalment quarter in which the transfer happens: see section 115-95 in Schedule 1 to the Taxation Administration Act 1953 .

Continuation of mining project interest

120-10(2)    
The mining project interest (the new interest ) that a miner (the new miner ) has just after a * mining project transfer is taken to be a continuation of the mining project interest (the original interest ) a miner (the original miner ) had just before the transfer.

Note:

This means, for example, that:

(a) the mining project interest retains the history of when it started, and of the miners who have had the interest at various times; and

(b) a choice made, under Division 85 , of the valuation approach for the mining project interest continues to have effect; and

(c) starting base assets that have been used to an extent in relation to the mining project interest before the transfer retain the history of that use.

Meaning of mining project transfer

120-10(3)    
A mining project transfer happens if:

(a) an * arrangement that has the effect of transferring the whole of the entitlement comprising a mining project interest from one miner to a single other * entity comes into force; and

(b) the mining project interest the other entity starts to have covers the same * project area .

Note:

If the arrangement relates to a combined interest (see Division 115 ) that is integrated because the original miner chose downstream integration:

(a) the interest will not be a combined interest after the transfer unless the new miner has chosen downstream integration; and

(b) under Division 125 , there will be a split of the combined interest until the new miner makes such a choice.

MRRT amounts move with interest

120-10(4)    
For the purposes of the application of the * MRRT law in the * MRRT year in which the transfer happens or a later MRRT year, each of the following amounts that, apart from this Division, would be an amount for the original miner and the original interest is instead an amount for the new miner and the new interest:

(a) an amount included in * mining revenue for the pre-transfer part year or an earlier MRRT year;

(b) an amount included in * mining expenditure for the pre-transfer part year or an earlier MRRT year;

(c) an amount of a * royalty credit arising for the original interest in the pre-transfer part year;

(d) an amount of an * allowance component arising in an earlier MRRT year;

(e) if the transfer happens because of the operation of section 120-25 - the amount of the * pre-mining loss cap (if any) for the original interest.

Note 1:

Under section 120-25 , the start of a mining venture may be taken to be a mining project transfer.

Note 2:

If the original miner ' s MRRT year starts before the new miner ' s MRRT year, the effect of this provision is that amounts from before the start of the new miner ' s MRRT year are taken into account for the new miner in the new miner ' s MRRT year.

Example:

The original miner has a substituted accounting period of 12 months from 1 April to 31 March. The new miner has an MRRT year of 1 July to 30 June. The transfer happens on 1 July. The amounts covered by subsection (4) are all amounts that would be amounts for the original miner for the period from 1 April to 30 June, so these will be amounts for the new miner for the MRRT year 1 July to 30 June.

Choices

120-10(5)    
Despite subsection (4) , in working out under that subsection an amount for the * MRRT year in which the transfer happens or a later MRRT year, a choice of the following kind made by the new miner is taken into account, but a choice of that kind made by the original miner is disregarded:

(a) a choice under Division 175 to use the alternative valuation method in relation to the mining project interest for the * MRRT year in which the mining project transfer happens;

(b) a choice under Division 200 to use the simplified MRRT method for that year.

Note:

The effect of a simplified MRRT method choice made for a year before the transfer year is not affected: all allowance components are extinguished (see Division 200 ).

Example:

An original miner had made a choice to use the alternative valuation method in the MRRT year in which a mining project transfer happens. The new miner makes no choices.

The new miner works out the amounts to include in its mining revenue for the pre-transfer part year by working out the amount the original miner would have included if the original miner had not chosen to use the alternative valuation method.

Suspension day

120-10(6)    
If there is a * suspension day for the mining project interest that was chosen under paragraph 130-10(1)(a) :

(a) the * mining project transfer does not affect:

(i) any extinguishment under section 130-15 of * allowance components relating to the mining project interest; or

(ii) any * rehabilitation tax offset amounts , for any earlier * MRRT years , relating to the mining project interest; and

(b) that suspension day:

(i) does not affect any further allowance components relating to the mining project interest and that MRRT year or later MRRT years; but

(ii) is no longer to be taken into account in determining whether there are any rehabilitation tax offset amounts, for that MRRT year or any later MRRT years, relating to the mining project interest.

Note:

The new miner may make a suspension day choice in the circumstances set out in Division 130 .