The ATO on Wed 12.6.2013, released an Interim Decision Impact Statement on the decision in AAT Case [2013] AATA 351, Re ZZGN and FCT. In that case, the AAT confirmed that the term “exploration” in the PRRTA Act should be read according to its ordinary everyday meaning.
As a result, it affirmed that part of the Commissioner’s objection decision allowing a deduction for relevant expenditure but set aside that part of the objection decision disallowing a deduction.
The ATO said the purpose of the Interim Decision Impact Statement was to provide preliminary comments on the decision given that the Commissioner is currently consulting with the industry on the development of a public ruling. It said it agrees with the decision of the Tribunal on the ordinary meaning of “exploration” and considers it to be in line with its submissions. The ATO also said it agrees with the AAT’s view that the term “in connection with” involves a reasonably direct relationship between the “operations” for which expenditure has been incurred and “exploration”.
COMMENTS are due by 7 August 2013. ATO contact: Brett Tyers – Tel: (08) 9268 5424; Fax: (08) 9268 5250; Email: brett.tyers@ato.gov.au.
[LTN 111, 12/6/13]