165‑35 Starting base adjustments for par165‑35 Starting base adjustments for partial disposal of starting base assets

165‑35 Starting base adjustments for partial disposal of starting base assets

(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. (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.

Note: 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.

Note: 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.

Note: 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).

(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.