MINERALS RESOURCE RENT TAX ACT 2012 (REPEALED)

CHAPTER 4 - SPECIALIST LIABILITY RULES  

PART 4-3 - ADJUSTING MRRT LIABILITIES  

Division 165 - Starting base adjustments  

Subdivision 165-C - Partial disposal of starting base assets  

SECTION 165-35   STARTING BASE ADJUSTMENTS FOR PARTIAL DISPOSAL OF STARTING BASE ASSETS  

165-35(1)    
If:

(a) during an * MRRT year , a miner ceases to * hold a part of a * starting base asset relating to a mining project interest that a miner has; and

(b) the cessation would be a * starting base adjustment event if the part were a starting base asset;

apply this Division as if that part were a starting base asset (the disposed asset ) and as if the cessation were a starting base adjustment event for the disposed asset.

165-35(2)    
The adjustable value of the disposed asset is a reasonable proportion of what would be the adjustable value of the * starting base asset of which it is a part, if a * starting base adjustment event were to happen for that starting base asset at the time of the cessation.

Example:

A miner holds a truck that, at the start of a particular MRRT year, has a base value of $ 10 million and a remaining effective life of 10 years. Halfway through the MRRT year, the miner sells a 75 % interest in the truck for $ 6 million.

At the time of the sale, the adjustable value of the entire truck is $ 9.5 million, so the adjustable value of the disposed asset is $ 7.125 million (75 % of $ 9.5 million). The termination value of the disposed asset is $ 6 million.

Under subsection 165-10(2) , the miner has a starting base adjustment amount for the truck of $ 1.125 million ( $ 7.125 million − $ 6 million).

165-35(3)    
Despite subsection (1) , this section does not apply to the disposed asset if at the same time as the miner ceases to * hold the disposed asset, the miner also ceases to hold the remainder of the * starting base asset .