The scope of a mineral extraction trade does not include
exploring for new sources of mineral deposits. Therefore,
expenditure incurred in prospecting for new mineral sources,
including experimental boring, is capital expenditure, or abortive
capital expenditure, on acquiring fixed capital assets of the
trade.
Mineral extraction allowances are available for qualifying
expenditure on mineral exploration in accordance with CAA01/S400
(see CA50230) and, for pre-trading exploration expenditure,
CAA01/S401 (see CA50250 to CA50270).
For the tax treatment of expenditure to locate pockets and
lost seams from existing mine workings see
BIM62010.
