Finance (Taxation of Profits of Certain Mines) Act, 1974

Allowance in respect of development expenditure and exploration expenditure.

2.—(1) Where a person who is carrying on the trade of working a qualifying mine incurs, on or after the 6th day of April, 1974, any development expenditure or exploration expenditure and makes application under section 245 of the Act of 1967 for a mine development allowance for a year of assessment in respect of such expenditure—

(a) that expenditure shall be deemed to be expenditure in respect of which that allowance may be granted, whether or not, in the case of exploration expenditure, a deposit of scheduled minerals is found as a result of the expenditure,

(b) the amount of such allowance for that year of assessment shall be equal to the total amount of—

(i) the exploration expenditure, and

(ii) in the case of development expenditure the amount of the difference between that expenditure and the amount which, in the opinion of the inspector, the assets representing that expenditure are likely to be worth at the end of the estimated life of the aforesaid mine, and

(c) in relation to a case in which this section has had effect, any reference in the Income Tax Acts to an allowance made under the said section 245 shall be construed as including a reference to an allowance made under that section by virtue of this section:

Provided that no account shall be taken, for the purposes of this section, of exploration expenditure as a result of which a deposit of scheduled minerals is not found if the expenditure was incurred more than ten years prior to the date on which the person aforesaid commences to carry on the trade of working a qualifying mine.

(2) Where a person who is carrying on the trade of working a qualifying mine incurred before the 6th day of April, 1974, capital expenditure in respect of which he was entitled under section 245 of the Act of 1967 to apply for a mine development allowance and there is an amount of that expenditure still unallowed on the said date, the person may elect to have the amount of mine development allowance for the year of assessment 1974-75 in respect of that expenditure increased to an amount equal to the amount of the expenditure so unallowed.

(3) In this section the amount of expenditure still unallowed on the 6th day of April, 1974, shall be taken to be the amount of the estimated difference, within the meaning of section 245 (5) (b) of the Act of 1967, less any mine development allowance granted, or deemed under section 245 (13) of the said Act to have been granted, for any year of assessment before the year of assessment 1974-75.

(4) No allowance shall be made under subsection (1) in respect of expenditure incurred before the 6th day of April, 1974, whether or not such expenditure is, by virtue of any provision of this Act, the Finance Act, 1946 , or the Act of 1967, deemed to have been incurred on or after the said date.