Australia Mining & Resources Tax Guide
Australian mining and resources sector taxation. The guide covers: the Petroleum Resource Rent Tax (the 'PRRT') — the 'PRRT' is the 'federal tax' on the 'profits from the offshore petroleum projects' (the 'oil and the gas projects' in the 'Commonwealth waters'); the 'PRRT rate' is 40% on the 'net project income' (the 'project revenue minus the project expenditure'); the 'PRRT' applies to the 'offshore petroleum projects' (the 'North West Shelf', the 'Gorgon', the 'Wheatstone', the 'Ichthys') and the 'onshore petroleum projects' (the 'Beetaloo', the 'McArthur River', the 'Cooper Basin'); the 'PRRT' is 'deductible for the corporate tax purposes' (the 'PRRT paid is the 'deductible expense'); the mining royalties — the 'mining royalties' are the 'state government royalties' on the 'extraction of the minerals' (the 'coal', the 'iron ore', the 'gold', the 'copper', the 'lithium', the 'rare earths', the 'mineral sands'); the 'royalty rates vary by the state' and the 'mineral type' — the 'QLD coal royalty rates' are from 7% to 40% (the 'progressive royalty rate' for the 'coal above $150 per tonne'), the 'WA gold royalty rate' is 2.5% for the 'gold above $3,500 per ounce', the 'SA mining royalty rate' is 0% to 10% depending on the 'mineral'; the 'royalties' are 'deductible for the corporate tax purposes'; the fuel tax credits for the mining — the 'mining companies' can claim the 'fuel tax credits' for the 'fuel used in the 'eligible mining activities' — the 'off-road mining equipment' (the 'excavators', the 'haul trucks', the 'drills', the 'dozers', the 'generators') is 'eligible for the full fuel tax credit rate' (the 'excise rate' — approximately 47.7 cents per litre for the 'diesel'); the 'mining companies' use the 'fuel in the 'mining and the processing' at the 'mine site' — the 'fuel is NOT subject to the 'road user charge' (the 'off-road rate applies'); the mining capital allowances — the 'mining assets' (the 'mine infrastructure', the 'processing plant', the 'mining equipment') are the 'depreciating assets' under the 'Division 40 of the ITAA 1997'; the 'mining assets' have the 'effective life' determined by the 'ATO' — the 'mine buildings' have the 'effective life of 20 to 30 years', the 'mining plant and equipment' have the 'effective life of 5 to 15 years'; the 'mining companies' can claim the 'capital works deduction' (the 'Division 43 deduction') for the 'mine housing and the accommodation' (the 'mine camp' and the 'mining village') at the rate of 2.5% per year; the FBT on the FIFO accommodation — the 'mining companies' that 'provide the accommodation' to the 'FIFO workers' (the 'mine accommodation', the 'camp', the 'village') are 'exempt from the FBT' if the 'accommodation is the 'remote area accommodation''; the 'meals provided to the FIFO workers' at the 'mine site' are 'exempt from the FBT' (the 'minor benefit exemption' may apply).
PRRT & Royalties
- PRRT at 40%: The 'Petroleum Resource Rent Tax' on the 'offshore oil and gas profits'. The 'PRRT is deductible for the corporate tax'.
- State mining royalties: The 'QLD coal royalty' — 7% to 40%. The 'WA gold royalty' — 2.5%. The 'royalties are deductible'.
For the corporate tax and the PRRT deductibility, see our Corporate Tax Guide →.
Fuel Tax & Depreciation
- Fuel tax credits: The 'full fuel tax credit rate' (47.7 cents per litre) for the 'off-road mining fuel'.
- Mining depreciation: The 'mining assets' — 'effective life of 5 to 30 years'. The 'capital works at 2.5%' for the 'mine accommodation'.
For the fuel tax credits and the eligible activities, see our Fuel Tax Credits Guide →.
FIFO Accommodation
- Remote area accommodation: The 'mine camp and the village accommodation' are 'exempt from the FBT'.
- Meals at the mine: The 'meals provided to the FIFO workers' are 'exempt from the FBT'.
For the FBT exemptions and the remote area rules, see our Fringe Benefits Tax Guide →.