Akta Kewangan (No. 2) 2023 · Updated to 29 Dec 2023 · Chapter 6
173. Post-filing Adjustments and Tax Rate Changes
Feedback & supportAn adjustment to a Constituent Entity’s liability for Covered Taxes for a previous Financial Year recorded in the financial accounts shall be treated as an adjustment to Covered Taxes in the Financial Year in which the adjustment is made, unless the adjustment relates to a Financial
Year in which there is a decrease in Covered Taxes for the jurisdiction.
In the case of a decrease in Covered Taxes included in the Constituent Entity’s Adjusted Covered Taxes for a previous
Financial Year, the Effective Tax Rate and Multinational Top-up
Tax for such Financial Year shall be recalculated under subsection 181(1).
Subject to the recalculations provided under subsection 181(1), the Adjusted Covered Taxes determined for the Financial Year shall be reduced by the amount of the decrease in Covered Taxes and GloBE Income determined for the Financial Year and any intervening Financial Years shall be adjusted as necessary and appropriate.
A Filing Constituent Entity may make an Annual
Election to treat an immaterial decrease in Covered Taxes as an adjustment to Covered Taxes in the Financial Year in which the adjustment is made.
An immaterial decrease in Covered Taxes is an aggregate decrease of less than one million euro in the
Adjusted Covered Taxes determined for the jurisdiction for a Financial Year.
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The amount of deferred tax expense resulting from a reduction to the applicable domestic tax rate shall be treated as an adjustment to a Constituent Entity’s liability for Covered Taxes claimed under section 169 for a previous
Financial Year when such reduction results in the application of a rate that is less than the Minimum Rate.
The amount of deferred tax expense, when paid, that has resulted from an increase to the applicable domestic tax rate shall be treated as an adjustment under subsections (1)
to (5) to a Constituent Entity’s liability for Covered Taxes claimed under section 169 for a previous Financial Year when such amount was originally recorded at a rate less than the
Minimum Rate.
The adjustment under subsection (7) is limited to an amount that is equal to an increase of deferred tax expense up to such deferred tax expense recast at the Minimum Rate.
Where more than one million euro of the amount accrued by a Constituent Entity as current tax expense and included in Adjusted Covered Taxes for a Financial Year is not paid within three years of the last day of such year, the
Effective Tax Rate and Multinational Top-up Tax for the
Financial Year in which the unpaid amount was claimed as a Covered Tax must be recalculated in accordance with subsection 181(1) by excluding such unpaid amount from
Adjusted Covered Taxes.