70‑35 Meaning of pre‑mining expenditure 70‑35 Meaning of pre‑mining expenditure etc.

#### 70‑35 Meaning of pre‑mining expenditure etc. Pre‑mining expenditure (1) An \*entity’s pre‑mining expenditure, for a \*pre‑mining project interest for an \*MRRT year, is the sum of all amounts that, under this Act, are included in the entity’s pre‑mining expenditure for the interest for the year. > Note: Most of the amounts are covered by this Division. However, the following amounts may also be included in a miner’s pre‑mining expenditure: (a) amounts arising as a result of adjustments to take account of changes in circumstances (see Division 160); (b) amounts arising as a result of changed use of starting base assets (see section 165‑55). (2) An amount of expenditure is included in an \*entity’s \*pre‑mining expenditure for a \*pre‑mining project interest for an \*MRRT year to the extent that the entity necessarily incurred the amount in that year in carrying on \*pre‑mining project operations of the interest. (3) The expenditure may be of either a capital or revenue nature. Excluded expenditure (4) However, an amount is not included in the \*entity’s \*pre‑mining expenditure for the \*pre‑mining project interest for the \*MRRT year to the extent that it: (a) is \*excluded expenditure; or (b) would be excluded expenditure, if: (i) the pre‑mining project interest were a mining project interest; and (ii) the \*exploration right to which the pre‑mining project interest relates were a \*production right to which the mining project interest relates; and (iii) in a case where the entity is not a miner—the entity were a miner. > Note: For excluded expenditure, see Subdivision 35‑B. Pre‑mining project operations (5) Operations or activities are the pre‑mining project operations of the \*pre‑mining project interest to the extent that, if the pre‑mining project interest were a mining project interest, the operations or activities would be \*upstream mining operations in relation to such a mining project interest. (6) It does not matter where, or when, the operations or activities are carried on. Expenditure for deferred farm‑out arrangement where no interest transferred (7) An amount of expenditure is included in an \*entity’s \*pre‑mining expenditure for a \*pre‑mining project interest for an \*MRRT year to the extent that: (a) another entity necessarily incurred the amount in that MRRT year, or an earlier MRRT year, in carrying on \*exploration or prospecting for \*taxable resources in the \*project area for the pre‑mining project interest; and (b) the exploration or prospecting was carried on under an \*arrangement with the entity; and (c) the terms of the arrangement gave the other entity a right, or a contingent right, to acquire from the entity an interest in the \*exploration right to which the pre‑mining project interest relates; and (d) in that MRRT year, the other entity stops having the right, without acquiring the interest in the exploration right. No double counting (8) If 2 or more provisions of this Act include the same amount in an \*entity’s \*pre‑mining expenditure (whether for the same \*MRRT year or a different MRRT year), the amount is included only under the provision that is most appropriate. (9) If: (a) a provision of this Act includes an amount in an \*entity’s \*pre‑mining expenditure; and (b) the same amount is included, by another provision of this Act, in the entity’s \*mining expenditure (whether for the same \*MRRT year or a different MRRT year); the amount is included only under the provision that is most appropriate.