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

CHAPTER 9 - TRANSITION RULES  

PART 9-1 - TAX ATTRIBUTES UPON TRANSITION  

SECTION 9-5   PRE-TRANSITION YEAR DEFERRED TAX ASSETS AND LIABILITIES  

9-5(1)    
This section applies for the purposes of computing the Total Deferred Tax Adjustment Amount, for a Constituent Entity of an MNE Group located in a jurisdiction, for a Fiscal Year (the current year ) that is:

(a)    the MNE Group ' s Transition Year for the jurisdiction; or

(b)    a subsequent Fiscal Year, if the Constituent Entity has not ceased to be a Constituent Entity of the MNE Group in the intervening period.

9-5(2)    
In computing the Constituent Entity ' s Total Deferred Tax Adjustment Amount for the current year, despite subsections 4-85(2) , (3) , (4) and (5) :

(a)    take account of each deferred tax asset and deferred tax liability that is reflected or disclosed in the Constituent Entity ' s financial accounts at the beginning of the Transition Year; and

(b)    take account of the deferred tax asset or deferred tax liability in the amount set out in section 9-10 .

9-5(3)    
Subsection (2) does not apply in relation to a deferred tax asset that arises:

(a)    as a result of a transaction that occurs in the period that:

(i) starts on 1 December 2021; and

(ii) ends immediately before the start of the Transition Year; and

(b)    in respect of an amount that:

(i) is not included in the Constituent Entity ' s taxable income for a Fiscal Year; and

(ii) assuming the amount arose in the Transition Year, would not have been taken into account in computing the Constituent Entity ' s GloBE Income or Loss for the Transition Year.

9-5(4)    
If the Constituent Entity has a Recaptured Deferred Tax Liability for the current year under section 4-105 in respect of a deferred tax liability mentioned in paragraph (2)(a) of this section, section 4-100 does not apply in relation to that Recaptured Deferred Tax Liability.