When calculating their annual profit for a fiscal year ending after March 27, 2018, operators can deduct the environmental studies allowance in respect of expenses incurred after that date.

The maximum amount that an operator can deduct for a fiscal year is equal to the balance of the cumulative environmental studies expenses at the end of the fiscal year.

Balance of cumulative environmental studies expenses

The balance of the cumulative environmental studies expenses of an operator at the end of a fiscal year generally corresponds to 50% of the environmental studies expenses incurred by the operator after March 27, 2018, in respect of mining projects in Québec, including expenses incurred for studies undertaken to obtain an exploration right, licence or privilege, minus the amounts that the operator deducted as an environmental studies allowance in calculating the annual profit for previous fiscal years that ended after March 27, 2018.

It does not include:

• expenses incurred for environmental studies undertaken to determine the existence, location, extent or quality of a mineral substance, or expenses incurred for environmental studies undertaken for one of the reasons mentioned above to obtain an exploration right, licence or privilege (these expenses are exploration expenses if they are incurred after February 2015 and are included at 100% in calculating the balance of cumulative exploration expenses);
• expenses that can be attributed to a mine which has come into production in reasonable commercial quantities or to an actual or potential extension of such a mine; or
• fees payable under a law or regulation as rates, administrative expenses, guarantees, compensation measures or other similar expenses (for example, fees payable under the Environment Quality Act or the financial contribution payable for the protection of wetlands and bodies of water).