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

CHAPTER 7 - TAX NEUTRALITY AND DISTRIBUTION REGIMES  

PART 7-6 - TAXABLE DISTRIBUTION METHOD ELECTION  

SECTION 7-170   EFFECT OF REVOKING ELECTION  

7-170(1)    
This section applies if:

(a)    an election under subsection 7-145(1) applies to:

(i) an Investment Entity that is a Constituent Entity of an MNE Group; and

(ii) a Constituent Entity-owner of the Investment Entity; and

(b)    the election is revoked in a Fiscal Year (the revocation year ); and

(c)    there is an Undistributed Net GloBE Income Account for the Investment Entity for the Fiscal Year that is the second Fiscal Year preceding the revocation year; and

(d)    the balance of the Undistributed Net GloBE Income Account is above zero at the end of the revocation year.

7-170(2)    
In computing the Investment Entity ' s GloBE Income or Loss for the revocation year, include the Constituent Entity-owner ' s proportionate share of the balance of the Undistributed Net GloBE Income Account (the Constituent Entity-owner ' s undistributed share ).

7-170(3)    
For purposes of Chapter 2 :

(a)    treat the Investment Entity as a Low-Taxed Constituent Entity of the MNE Group for the reporting year; and

(b)    treat the Top-up Tax of the Investment Entity for the reporting year as being the amount equal to:

(i) the Constituent Entity-owner ' s undistributed share;

multiplied by:

(ii) the Minimum Rate.