Operators can deduct the exploration, mineral deposit evaluation and mine development allowance in respect of expenses incurred before March 31, 2010, in calculating their annual profit for a fiscal year.

The maximum amount that an operator can deduct as an exploration, mineral deposit evaluation and mine development allowance for a fiscal year is equal to the balance of cumulative exploration, mineral deposit evaluation and mine development expenses at the end of the year.

Balance of cumulative exploration, mineral deposit evaluation and mine development expenses

In general, the balance of cumulative exploration, mineral deposit evaluation and mine development expenses of an operator at the end of the fiscal year corresponds to the result of the following calculation:

• the total of the following amounts:
  • the exploration, mineral deposit evaluation and mine development expenses incurred by the operator after May 12, 1994, and before March 31, 2010, and
  • 25% of the expenses referred to in the first point that were incurred in the Near North and in the Far North after March 31, 1998, and with regard to which the refundable tax credit relating to resources could not be claimed;
• minus any amounts that the operator deducted as an exploration, mineral deposit evaluation and mine development allowance in calculating the annual profit for previous fiscal years.