Revenue Note for Guidance

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Revenue Note for Guidance

676 Expenditure incurred by person not engaged in trade of mining


This section provides relief in respect of exploration expenditure incurred by a person who finds a deposit of scheduled minerals and who, without having carried on a trade of working that deposit, sells the assets representing that expenditure to another person. In such cases the person who develops and works the mine is entitled to claim relief for the exploration expenditure incurred in connection with the mine.


(1) Relief is provided for exploration expenditure incurred by a person who finds a scheduled mineral deposit and then sells the assets representing the expenditure to another person who develops and works the mine. In such circumstances, the purchaser is regarded as having incurred exploration expenditure equal to the amount represented by the assets or the price paid for those assets, whichever is the less, and is entitled to a deduction in respect of this expenditure.

(2) No such allowance is to be granted unless the person acquiring the assets produces qualifying minerals in reasonable commercial quantities.

(3) 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.

(4) The investment allowance in respect of exploration expenditure provided for in section 677 is not to apply to the expenditure covered by this section.

Relevant Date: Finance Act 2021