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Income Tax Act 2007

Deductions - Mineral mining expenditure - Classes of mining expenditure

DU 9: Some definitions

You could also call this:

“Explaining key terms used in mining prospecting and exploration”

When you’re involved in mining, there are some special words you need to know. These words help explain what kind of money you spend when you’re looking for minerals to mine.

‘Mining prospecting expenditure’ means the money you spend when you’re trying to find minerals. This includes getting a special right to look for minerals from the government, which is called a prospecting right. It also includes getting information about where minerals might be. This could be paying for people to work, buying materials, or getting services to help find this information.

When you’re prospecting, you might use different ways to look for minerals. You could use electrical methods, study the chemistry of the ground, look at how heavy things are, use magnets, check for radioactive materials, or use sound waves to understand what’s underground. All of these ways count as mining prospecting expenditure.

But some things don’t count as mining prospecting expenditure. You can’t include the cost of buying land, or big machines and equipment. There are also some other types of spending that don’t count, which are explained in another part of the law called section DU 8(1)(b) to (d). Lastly, something called ‘residual expenditure’ doesn’t count either.

‘Mining prospecting information’ is another important term. This means information about the earth that tells you if there are special industrial minerals in an area, how much of them there might be, or where exactly they are. It can also be information that helps figure these things out.

This text is automatically generated. It might be out of date or be missing some parts. Find out more about how we do this.

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM1514120.

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DU 8: Classes of mineral mining expenditure, or

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Part D Deductions
Mineral mining expenditure: Classes of mining expenditure

DU 9Some definitions

  1. Mining prospecting expenditure—

  2. means expenditure that a mineral miner incurs directly in relation to the acquisition of—
    1. a prospecting right under the Crown Minerals Act 1991:
      1. mining prospecting information, including labour, materials, services, and administrative expenses directly incurred in acquiring the information; and
      2. includes prospecting for minerals by electrical, geochemical, gravimetric, magnetic, radioactive, seismic, or other geological methods; and
        1. does not include—
          1. the cost of land, plant, or machinery:
            1. expenditure referred to in section DU 8(1)(b) to (d):
              1. residual expenditure.

              2. Mining prospecting information means geological, geophysical, or technical information—

              3. that is about the presence, absence, extent, or volume of listed industrial minerals in an area; or
                1. that is likely to assist in determining the presence, absence, extent, or volume of listed industrial minerals in an area.

                  Notes
                  • Section DU 9: replaced, on (applying for the 2014–15 and later income years), by section 41(1) of the Taxation (Annual Rates, Foreign Superannuation, and Remedial Matters) Act 2014 (2014 No 4).