ARTICLE · 31 DECEMBER 2012

Mineral Royalties Relief – A Clarification

Smith & Williamson

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In the Spotlight we referred to the possibility that the existing regime of treating receipts as 50% income and 50% capital would continue until the mineral lease had ended.

United KingdomTax

In the article 'Mineral Royalties Relief...it's not set in stone' in the October edition of In the Spotlight we referred to the possibility that the existing regime of treating receipts as 50% income and 50% capital would continue until the mineral lease had ended. The article should have stated that any current arrangements will continue only until April 2013.

Therefore, where negotiations are currently underway it may be advantageous to finalise the contract so at least some of the monies received prior to April 2013 are liable to CGT. In addition, finalising the contract before next April would ensure that the ability to claim a capital loss on the reduction in value of the land should also continue beyond April 2013.

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