Malaysia legislation
Section 186
Section 186
(2)
If the disposition or acquisition of assets and liabilities is part of a GloBE Reorganisation, subsection (1) shall not apply and—
(a)
a disposing Constituent Entity will exclude any gain or loss on the disposition from the computation of its GloBE Income or Loss; and
(b)
an acquiring Constituent Entity will determine its
GloBE Income or Loss after the acquisition using the disposing Entity’s carrying values of the acquired assets and liabilities upon disposition.
(3)
If a disposition or acquisition of assets and liabilities is part of a GloBE Reorganisation in which a disposing
Constituent Entity recognises Non-qualifying Gain or Loss, subsections (1) and (2) shall not apply and—
(a)
the disposing Constituent Entity will include gain or loss on the disposition in its GloBE Income or Loss computation to the extent of the Non-qualifying
Gain or Loss; and
(b)
an acquiring Constituent Entity will determine its
GloBE Income or Loss after the acquisition using the disposing Entity’s carrying value of the acquired assets and liabilities upon disposition adjusted consistent with local tax rules to account for the
Non-qualifying Gain or Loss.
Act 851
(4)
At the election of the Filing Constituent Entity, a Constituent Entity of a Multinational Enterprise Group that is required or permitted to adjust the basis of its assets and the amount of its liabilities to fair value for tax purposes in the jurisdiction in which it is located, shall—
(a)
include in the computation of its GloBE Income or
Loss an amount of gain or loss in respect of each of its assets and liabilities that is equal to the difference between the carrying value for financial accounting purposes of the asset or liability immediately before and the fair value of the asset or liability immediately after the date of the event that triggered the tax adjustment (hereinafter referred to as “the triggering event”) and decreased or increased by the Non-qualifying Gain or Loss, if any, arising in connection with the triggering event;
(b)
use the fair value for financial accounting purposes of the asset or liability immediately after the triggering event to determine GloBE Income or
Loss in Financial Years ending after the triggering event; and
(c)
include the net total of the amounts determined in paragraph (a) in the Constituent Entity’s GloBE
Income or Loss in one of the following manner:
(i)
the net total of the amounts is included in the Financial Year in which the triggering event occurs; or
(ii)
an amount equal to the net total of the amounts divided by five is included in the Financial Year in which the triggering event occurs and in each of the immediate four subsequent Financial Years, unless the
Constituent Entity leaves the Multinational
Enterprise Group in a Financial Year within this period, in which case the remaining amount will be wholly included in that
Financial Year.
Finance (No. 2)
113
Joint Ventures