Income Tax (Trading and Other Income) Act 2005 section 339

Deduction for management expenses of owner of mineral rights

Section 339 allows owners of mineral rights in the United Kingdom to deduct the costs of managing or supervising those minerals from the rental income they receive.

• The owner must have let (rented out) the right to work minerals in the United Kingdom during the tax year
• Any management or supervision expenses claimed must have been paid wholly and exclusively for that purpose within the tax year
• The deduction is made when calculating the amount of rent receivable in connection with a UK section 12(4) concern (that is, mineral royalties taxed under specific provisions rather than as part of a UK property business)
• Where the mineral income is instead taxed as part of a UK property business, the normal property business deduction rules apply and this special provision is not needed