675 Exploration expenditure incurred by certain bodies corporate

Summary

This section provides that exploration expenditure incurred by a company which is a member of a group of companies may be attributed to any other group member.

Details

(1) An exploration company in a group of wholly-owned subsidiaries may elect to have its exploration expenditure (whether successful or abortive) attributed to any other subsidiary in the group or to the parent company so that the exploration expenditure may be set off against mining profits wherever they arise within the group. Where the expenditure was incurred before the company which is deemed to have incurred it was incorporated, the company is deemed to have been in existence and to have incurred the expenditure at that time.

(2)(a) The same expenditure cannot be taken into account in more than one trade.

(2)(b) Apart from transitional relief (paragraphs 16 and 18 of Schedule 32), expenditure that qualifies for an allowance by virtue of this section cannot qualify for a deduction or allowance under some other tax provision.

(3) A body corporate is deemed to be a wholly-owned subsidiary of another body corporate if the latter owns all the ordinary share capital of the former, either directly, or through other bodies corporate, or both. A holding of ordinary share capital by a Minister of the Government is disregarded for this purpose.

(4) The provisions of section 9 are applied for the purposes of determining the amount of ordinary share capital held in a body corporate through other bodies corporate.

Relevant Date: Finance Act 2021