Canada: Relief proposed for certain mining operations (COVID-19)
Canada: Relief proposed for certain mining operations
Proposals to aid flow-through share issuers and “junior” mining exploration companies would provide more time for eligible flow-through expenses to be incurred—measures that would be allowed in response to the coronavirus (COVID-19) pandemic.
Junior mining exploration companies and other flow-through share issuers will be allowed an additional 12 months to spend capital they raise via flow-through shares.
The Department of Finance announced (10 July 2020) its proposal to extend the period that junior mining exploration companies and other issuers can incur eligible flow-through share expenses, given the challenges faced by many of these companies as a result of COVID-19.
Finance is also proposing to provide some relief for the “Part XII.6 tax” that generally applies to eligible Canadian exploration expenses that are renounced before they are incurred under the "look-back rule” and temporarily provide relief by treating these expenditures as if they were incurred up to one year earlier than the date they are actually incurred (depending on the date the flow-through share agreement was entered into). The legislative amendments to implement these proposals are expected to be released in due course.
Read a July 2020 report prepared by the KPMG member firm in Canada
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