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

Expenditure incurred by person not engaged in the trade of mining.

5.—(1) Where, whether before, on or after the 6th day of April, 1974, a person incurs or incurred exploration expenditure which resulted in the finding of a deposit of scheduled minerals and, without having carried on any trade which consists of or includes the working of that deposit and without having claimed any allowance or deduction under or by virtue of this Act in respect of that expenditure, he sells any assets representing that expenditure to another person, then, if that other person carries on such a trade as aforesaid in connection with that deposit, that other person shall, for the purposes of this Act, be deemed to have incurred for the purposes of the trade and in connection with the deposit, exploration expenditure equal to the amount of the exploration expenditure which is represented by the assets or the price paid by him for the assets, whichever is the smaller, and that expenditure shall be deemed to have been incurred by him on the date on which he commences to carry on the trade aforesaid.

(2) A person who claims an allowance by virtue of subsection (1) in respect of expenditure represented by assets acquired by him shall not be deemed to have incurred that expenditure unless the working of the aforesaid deposit results in the production of scheduled minerals in reasonable commercial quantities.

(3) A deduction or allowance in respect of the same expenditure shall not be made both under this section and under some other provision of the Income Tax Acts or the Acts relating to corporation profits tax.

(4) Section 6 shall not apply to expenditure in respect of which an allowance is made by virtue of this section.