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

CHAPTER 3 - COMPUTATION OF GloBE INCOME OR LOSS  

PART 3-3 - INTERNATIONAL SHIPPING INCOME EXCLUSION  

SECTION 3-225   MEANING OF INTERNATIONAL SHIPPING INCOME, ETC.  

3-225(1)    
The International Shipping Income of a Constituent Entity of an MNE Group for a Fiscal Year is:

(a)    the Constituent Entity ' s International Shipping Income Revenue for the Fiscal Year (see subsection (2) );

reduced by:

(b)    the Constituent Entity ' s International Shipping Income Costs for the Fiscal Year (see subsection (3) ).

3-225(2)    
The International Shipping Income Revenue of a Constituent Entity of an MNE Group for a Fiscal Year means the revenue obtained by the Constituent Entity for the Fiscal Year from the following activities (each of which is an International Shipping Activity ):

(a)    transporting passengers or cargo by a ship that it operates in international traffic, whether the ship is owned, leased or otherwise at its disposal;

(b)    transporting passengers or cargo by a ship operated in international traffic under slot-chartering arrangements;

(c)    leasing a ship, to be used for transporting passengers or cargo in international traffic, on charter fully equipped, crewed and supplied;

(d)    leasing a ship on a bareboat charter basis, for transporting passengers or cargo in international traffic, to another Constituent Entity of the MNE Group;

(e)    participating in a pool, a joint business or an international operating agency for transporting passengers or cargo by a ship in international traffic;

(f)    if a ship is used for transporting passengers or cargo in international traffic and has been held for use by the Constituent Entity for at least 1 year - selling the ship.

3-225(3)    
The International Shipping Income Costs of a Constituent Entity of an MNE Group for a Fiscal Year means the amount computed in accordance with the following formula:

where:

direct costs
is the total costs incurred by the Constituent Entity for the Fiscal Year that are directly attributable to the Constituent Entity ' s performance of International Shipping Activities.

indirect costs
is the total costs incurred by the Constituent Entity for the Fiscal Year that are indirectly attributable to the Constituent Entity ' s performance of International Shipping Activities.

shipping revenue
is the Constituent Entity ' s International Shipping Income Revenue for the Fiscal Year.

total revenue
is the Constituent Entity ' s total revenue for the Fiscal Year.