The treatment of business expenditure for the upstream petroleum industry is generally the same as for other industries, with some more specific deductions.
Key taxation issues that may assist or impact on petroleum activities include:
- Company tax rate (also known as the corporate tax rate) is 30% and the lower company tax rate is 25%
- Immediate deductions for exploration activities and removal of redundant facilities
- Deductions for developing and operating a petroleum field may be deducted over the life of the project
- Capital Gains Tax (GCT)
- Fringe Benefits Tax (FBT) - there are concessions available such as for the provision if remote areas accommodation.
- R&D Tax Incentive
- Dividend Imputation
- Dividend withholding tax exemption for foreign source dividend income
- Agreements on avoidance of double taxation and foreign tax credits
- Thin capitalisation
- Indirect taxation - this includes GST at a rate of 10% applicable to most goods and services. Business may claim a tax credit for GST paid on business inputs
- Excise duties are payable on petroleum products (e.g. petrol, diesel) sold in Australia; exported products are exempt
- Fuel Tax Credits - excise duties paid on diesel and some other fuels used in operations may be eligible for fuel tax credits
For more specific information on Australian taxation requirements, visit the following websites: