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

CHAPTER 7 - TAX NEUTRALITY AND DISTRIBUTION REGIMES  

PART 7-6 - TAXABLE DISTRIBUTION METHOD ELECTION  

SECTION 7-150   EFFECT OF ELECTION - DISTRIBUTIONS AND DEEMED DISTRIBUTIONS RECEIVED BY CONSTITUENT ENTITY-OWNER INCLUDED IN COMPUTING ITS GloBE INCOME, ETC.  

7-150(1)    
This section applies if an election under subsection 7-145(1) applies to:

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

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

(c)    a Fiscal Year (the reporting year ).

7-150(2)    
In computing the Constituent Entity-owner ' s GloBE Income or Loss for the reporting year, include distributions and deemed distributions on which it is subject to Tax for the reporting year to the extent that they are attributable to the GloBE Income of the Investment Entity.

7-150(3)    
In computing the Constituent Entity-owner ' s:

(a)    GloBE Income for the reporting year; and

(b)    Adjusted Covered Taxes for the reporting year;

include an amount equal to so much of the Investment Entity ' s Covered Taxes for the reporting year as is allowed, under local tax law, as a credit against the Constituent Entity-owner ' s Tax liability for the reporting year arising in connection with a distribution from the Investment Entity.

7-150(4)    
In computing the MNE Group ' s Effective Tax Rate under Chapter 5 and Part 7-4 for the Fiscal Year for the jurisdiction in which the Investment Entity is located, exclude:

(a)    the Investment Entity ' s GloBE Income or Loss for the Fiscal Year; and

(b)    the Investment Entity ' s Adjusted Covered Taxes for the Fiscal Year, to the extent that they are attributable to such income (except as provided in subsection (3) ).