Mining transactions: duty requirements

Please provide the following where applicable:

1. completed duties valuation form for all mining tenements. Duties valuation forms are not required if a valuation is obtained from a qualified valuer which meets the criteria specified in Commissioner’s Practice TAA 23 ‘Circumstances when a Taxpayer will be Required to Provide a Written Valuation’
2. full details as to the method of calculation of the consideration paid. If the consideration includes other property, provide full details of how the parties determined the consideration apportioned to each item
3. when the consideration includes vendor shares – the value attributed to those shares. If the corporation to which the shares relate is not on the official list of a prescribed financial market, supply complete financial statements of that corporation for the three financial years up to the date of allotment
4. when the consideration includes a royalty payment – the value attributed to that royalty and a copy of any royalty agreement
5. when the consideration is reduced by the value of a derivative mining right held by the buyer, or granted by the buyer back to the seller or another person who held that right – the value attributed to the derivative mining right and a copy of any derivative mining right agreement
6. copies of all valuations conducted on tenements and/or derivative mining rights
7. relevant annual reports, resource reports or geological reports for the tenements or the derivative mining rights in relation to the tenements
8. tenement maps and location maps showing surrounding mines and prospects
9. copies of all reports, including Form 5 Exploration Expenditure Reports, lodged with the Department of Mines, Industry Regulation and Safety within the three years prior to the transaction
10. where the vendor is a listed corporation or member of a public group – copies of all statements to the ASX Group that contain details of mineralisation and exploration results
11. expiry dates of the tenements and advice as to whether they are renewable
12. if the tenements have been included in a public float, or are about to be floated, or have been involved in a takeover – a copy of the relevant prospectus if the event took place within the last two years
13. if the tenements relate to a sale of an interest in a joint venture – a copy of the joint venture agreement and full details of the asking price communicated to other joint venturers under any pre-emptive clause
14. copies of all relevant agreements relating to or affecting the tenements (e.g., joint venture agreements, royalty agreements, derivative mining rights agreements or assignment and assumption agreements)
15. current balance sheet of the entity that owns the tenements or derivative mining rights in relation to the tenements
16. any other relevant information that may assist in the assessment of duty.

In addition, if the tenements are at a sufficient stage of development for the following information to be available, provide:

1. production details for the tenements for the three years prior to the transaction
2. current balance sheet of the entity that owns the tenements or derivative mining rights in relation to the tenements
3. any other relevant information that may assist in the assessment of duty.

An assessment of duty will not be issued until all required information is provided.

Forms

• FDA32 ‘Duties Valuation - Mining Tenements’

Publications

• Commissioner’s Practice TAA 28 ‘Valuation of Shares Issued as Consideration for a Dutiable Transaction’
• Commissioner’s Practice TAA 30 ‘Valuation of Land for Duties Purposes’