Taxation (Multinational - Global and Domestic Minimum Tax) Rules 2024

CHAPTER 6 - CORPORATE RESTRUCTURINGS AND HOLDING STRUCTURES  

PART 6-1 - APPLICATION OF CONSOLIDATED REVENUE THRESHOLD TO GROUP MERGERS AND DEMERGERS  

SECTION 6-5   APPLICABLE MNE GROUPS - MERGERS  

6-5(1)    
This section specifies conditions for the purposes of paragraph 12(1)(b) of the Act.

6-5(2)    
An MNE Group (the merged Group ) meets the conditions specified in this section for a Fiscal Year (the test year ) if:

(a)    during the test year or the previous 4 Fiscal Years (the test period ):

(i) 2 or more Groups (the pre-merger Groups ) merged (see subsection (4) ) to form the merged Group; or

(ii) an Entity that is not part of a Group (the acquirer ) acquired or merged (see subsection (4) ) with one or more other Entities or Groups (the targets ) to form the merged Group; and

(b)    the merged Group would be an Applicable MNE Group for the test year under paragraph 12(1)(a) of the Act, on the assumption in subsection (3) of this section.

6-5(3)    
For the purposes of paragraph (2)(b) , assume that the following amounts were included in the annual revenue of the merged Group for a Fiscal Year in the test period (whether or not the merged Group existed in the Fiscal Year):

(a)    if subparagraph (2)(a)(i) applies - each amount shown as annual revenue in the Consolidated Financial Statements of the Ultimate Parent Entity of a pre-merger Group for an accounting period ending within the Fiscal Year;

(b)    if subparagraph (2)(a)(ii) applies - the following amounts:

(i) an amount shown as annual revenue in the financial statements of the acquirer for an accounting period ending within the Fiscal Year;

(ii) in the case of a target that is part of a Group for the Fiscal Year - an amount shown as annual revenue in the Consolidated Financial Statements of the Ultimate Parent Entity of the target for an accounting period ending within the Fiscal Year;

(iii) in the case of a target that is not part of a Group for the Fiscal Year - an amount shown as annual revenue in the financial statements of the target for an accounting period ending within the Fiscal Year.

6-5(4)    
For the purposes of this section, a merger means any arrangement under which:

(a)    all of the Group Entities of 2 or more separate Groups are brought under common control such that they are Group Entities of one Group; or

(b)    all (or substantially all) of the Group Entities of a Group, or 2 or more separate Groups, are brought under common control with one or more Entities such that they are Group Entities of one Group; or

(c)    an Entity that is not a member of any Group is brought under common control with another Entity or Group such that they are Group Entities of one Group.