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Income Tax Act 2007

Deductions - Petroleum mining expenditure

DT 16: Decommissioning

You could also call this:

“Tax deductions for petroleum miners shutting down operations”

You can subtract money from your taxes if you’re a petroleum miner and you spend money on decommissioning. This means you can pay less tax when you spend money to shut down your mining operations.

You can take this deduction in the same year that you spend the money. This is different from some other tax rules that might make you spread out deductions over time.

This rule is more important than another rule called section EA 2, which talks about other kinds of property that make money.

This rule adds to the general permission for tax deductions and overrides the rule about capital expenses. However, other general limits on tax deductions still apply to this situation.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1514080.

Topics:
Money and consumer rights > Taxes
Business > Industry rules
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DT 15: Persons associated with petroleum miner, or

“Rules for people working with petroleum miners who have existing privileges”

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DT 17: Attribution of expenditure, or

“How to claim deductions for petroleum permit and asset expenses”

Part D Deductions
Petroleum mining expenditure

DT 16Decommissioning

  1. A petroleum miner is allowed a deduction for expenditure that they incur on decommissioning.

  2. The deduction is allocated to the income year in which the expenditure is incurred.

  3. This section overrides section EA 2 (Other revenue account property).

  4. This section supplements the general permission and overrides the capital limitation. The other general limitations still apply.

Compare
Notes
  • Section DT 16 heading: replaced, on , by section 56(1) (and see section 56(4) for application) of the Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Act 2018 (2018 No 5).
  • Section DT 16(1): amended, on , by section 56(2) (and see section 56(4) for application) of the Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Act 2018 (2018 No 5).
  • Section DT 16 list of defined terms decommissioning: inserted, on , by section 56(3)(a) of the Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Act 2018 (2018 No 5).
  • Section DT 16 list of defined terms removal or restoration operations: repealed, on , by section 56(3)(b) of the Taxation (Annual Rates for 2017–18, Employment and Investment Income, and Remedial Matters) Act 2018 (2018 No 5).