Finance (No. 2) Act 2023 · Updated to 29 Dec 2023 · Chapter 7
178. Multinational Top-up Tax of a Constituent Entity
Feedback & supportExcept as provided in subsections 181(3) to (5), the
Multinational Top-up Tax of a Constituent Entity shall be determined for each Constituent Entity of a jurisdiction that has GloBE Income determined in accordance with Chapter 5
Multinational Top-up Tax
“Multinational Top-up Tax” means tax computed for the jurisdiction or Constituent Entity in accordance with sections 175 to 179;
of this Part for the Financial Year included in the computation of Net GloBE Income of that jurisdiction in accordance with the following formula:
Financial Year
“Financial Year” means an accounting period with respect to which the Ultimate Parent Entity of the Multinational Enterprise Group prepares its Consolidated Financial Statements and in the case of Consolidated Financial Statements as defined in paragraph (d) of the definition of “Consolidated Financial Statements”, Financial Year means the calendar year;
A x B
C where
A is the jurisdictional Top-up Tax as determined in accordance with subsection 177(1) or (2), as the case may be, for the jurisdiction for the Financial Year;
B is the GloBE Income of the Constituent
Entity, being the GloBE Income of the
Entity
“Entity” means— (a) any legal person (other than a natural person); or (b) an arrangement that prepares separate financial accounts, such as a partnership or trust;
Constituent Entity determined in accordance with section 165 for the jurisdiction for the Financial Year; and
Constituent Entity
“Constituent Entity” means— (a) any Entity that is included in a Group; or (b) any Permanent Establishment of a Main Entity that is within paragraph (a) and which is treated as separate from the Main Entity and any other Permanent Establishment of that Main Entity, but does not include an Excluded Entity;
C is the aggregate GloBE Income of all
Constituent Entities that have GloBE
Income for the Financial Year included in the computation of Net GloBE Income in accordance with subsection 174(4)
Net GloBE Income
“Net GloBE Income” means the amount as determined in accordance with subsection 174(4);
for the jurisdiction for the Financial Year.