Petroleum Resource Rent Tax Assessment Act 1987

SCHEDULE 1 - PROVISIONS RELATING TO INCURRING AND TRANSFER OF EXPLORATION EXPENDITURE ON OR AFTER 1 JULY 1990  

Sections 2 , 35A , 35B , 45A , 45B and 45D

PART 5 - GENERAL RULES RELATING TO TRANSFER OF EXPLORATION EXPENDITURE  

22   RULE - PERSON MUST HAVE HELD INTERESTS IN RELATION TO TRANSFERRING ENTITY AND RECEIVING PROJECT  

22(1)    
Subject to subclauses (2), (2AA), (2AB), (2A), (3) and (4), the person may only transfer the expenditure to the receiving project in relation to the transfer year if:

(a) the person held an interest in relation to the transferring entity at all times from the beginning of the financial year in which the expenditure was incurred to the end of the transfer year; and

(b) the person held an interest in relation to the receiving project at all times from the beginning of the financial year in which the expenditure was incurred to the end of the transfer year.

22(2)    
Subclause (1) does not require the person to have held an interest in relation to the transferring entity at a time before the starting day in relation to the transferring entity.

22(2AA)    
If:

(a) the person started (whether or not for the first time) to hold an interest in relation to the transferring entity during the financial year in which the expenditure was incurred; and

(b) the expenditure was incurred after the time (the farm-in time ) when the person started to hold the interest; and

(c) the expenditure was actually incurred by the person (rather than taken by section 48 or 48A to have been incurred by the person);

subclause (1) does not require the person to have held an interest in relation to the transferring entity before the farm-in time.

22(2AB)    
If:

(a) at a time (the cessation time ) after the expenditure was incurred and on or after 1 July 1993, the person ceased to hold any interest in relation to the transferring entity; and

(b) the cessation did not occur because of a transaction to which section 48 applies;

subclause (1) does not require the person to have held an interest in relation to the transferring entity at a time after the cessation time.

22(2A)    
Subclause (1) does not require the person to have held an interest in relation to the transferring entity at a time after the finishing day in relation to the transferring entity.

22(3)    
If the starting days in relation to the transferring entity and the receiving project occurred in the same financial year, subclause (1) does not require the person to have held an interest in relation to the receiving project at a time before the starting day in relation to the receiving project.

22(4)    
If the starting day in relation to the receiving project occurred in a later financial year than the financial year in which the expenditure was incurred:

(a) paragraph (1)(b) does not apply in relation to the transfer of the expenditure; and

(b) the person may only transfer the expenditure if (in addition to the requirement in paragraph (1)(a)):

(i) the exploration permit by reference to which the starting day in relation to the receiving project is determined was granted to the person; and

(ii) the person held an interest in relation to the receiving project at all times from the starting day in relation to the receiving project to the end of the transfer year.

22(5)    
For the purposes of subclause (1) but without limiting that subclause, the person is taken to hold an interest in relation to the transferring entity or the receiving project during a period if:

(a) in relation to all times during the period, the person and another person are group companies in relation to each other; and

(b) at all times during the period, the other person held an interest in relation to the transferring entity or the receiving project, as the case requires.

However, this subclause does not apply unless, at the time of the transfer referred to in subclause (1), the person holds an interest in both the transferring entity and the receiving project.