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

CHAPTER 5 - COMPUTATION OF EFFECTIVE TAX RATE  

PART 5-4 - ADDITIONAL CURRENT TOP-UP TAX  

SECTION 5-95   ADDITIONAL CURRENT TOP-UP TAX - ETR ADJUSTMENT PROVISIONS  

5-95(1)    
This section applies if, for a Fiscal Year (the current Fiscal Year ), the Effective Tax Rate and Jurisdictional Top-up Tax of an MNE Group for a jurisdiction for a prior Fiscal Year are required or permitted to be recalculated under an ETR Adjustment Provision (see subsection (6) ).

5-95(2)    
Recalculate the Effective Tax Rate and Jurisdictional Top-up Tax of the MNE Group for the jurisdiction for the prior Fiscal Year in accordance with Parts 5-1 to 5-3 , after taking into account the adjustments to Adjusted Covered Taxes and GloBE Income or Loss of Constituent Entities of the MNE Group for the jurisdiction for the prior Fiscal Year required by the relevant ETR Adjustment Provision.

5-95(3)    
If, disregarding this subsection, the recalculation results in an increase in the Jurisdictional Top-up Tax of the MNE Group for the jurisdiction for the prior Fiscal Year:

(a)    despite that recalculation, do not include the increase in the Jurisdictional Top-up Tax for the jurisdiction for the prior Fiscal Year; and

(b)    instead, treat the amount of that increase as an amount of Additional Current Top-up Tax of the MNE Group for the jurisdiction for the current Fiscal Year, in respect of the prior Fiscal Year.

5-95(4)    
For the purposes of working out a Parent Entity ' s Inclusion Ratio under section 2-15 , if there is no Net GloBE Income of the MNE Group for the jurisdiction for the current Fiscal Year, treat the GloBE Income for the current Fiscal Year of each Constituent Entity of the MNE Group located in the jurisdiction as being:

(a)    the Top-up Tax of the Constituent Entity for the jurisdiction for the current Fiscal Year;

divided by:

(b)    the Minimum Rate.

5-95(5)    
For the purposes of Chapter 2 , if as a result of subsection (3) or (4) , there is an increase to the Top-up Tax of a Constituent Entity of the MNE Group for a jurisdiction for a Fiscal Year, treat the Constituent Entity as a Low-Taxed Constituent Entity for the Fiscal Year.

5-95(6)    
ETR Adjustment Provision means section 3-160 , 4-100 , 4-140 , 4-145 , 7-65 or 7-75 .