Global Minimum Tax Act — G-3.3 42
al to the total of all amounts, each of which is (A) the proportionate share — of a qualifying owner in respect of whose ownership interest in the investment entity an election under this subsection applies — of the investment entity’s undistributed net GloBE income for the tested year, and (B) the GloBE income, if any, of the investment entity for the particular election year attributable to any ownership interests in the investment entity in respect of which an election under this subsection does not apply, and (ii) the top-up amount of the investment entity for the particular election year, determined in the absence of this subparagraph, is increased by the amount determined by the formula A × B where A is the total of all amounts described in clause (i)(A), and B is the minimum rate; (e) if the election is revoked, (i) for the purposes of subsection 15 (3), the GloBE income of the investment entity for the revocation year is deemed to be equal to the total of all amounts, each of which is (A) the proportionate share — of a qualifying owner in respect of whose ownership interest in the investment entity an election under this subsection applies — of the investment entity’s undistributed net GloBE income for any of the three tested years immediately preceding the revocation year, and (B) the GloBE income, if any, of the investment entity for the revocation year attributable to any ownership interests in the investment entity in respect of which an election under this subsection does not apply, and (ii) the top-up amount of the investment entity for the revocation year, determined in the absence of this subparagraph, is increased by the amount determined by the formula A × B where A is the total of all amounts described in clause (i)(A), and B is the minimum rate; and (f) the investment entity’s GloBE income or loss for an election year that is attributable to any ownership interests in respect of which an election under this subsection applies, and any adjusted covered taxes in respect of that GloBE income or loss, are excluded from all computations of effective tax rates and top-up amounts under this Act, other than as provided in paragraphs (c) to (e). Deemed distribution — transfer of ownership interest (3) For the purposes of this section, if, in an election year, a qualifying owner (referred to in this subsection as the “transferor”) transfers an ownership interest in an investment entity in respect of which an election under subsection (2) applies to a person that is not a group entity in respect of the transferor, (a) the transfer is treated as a deemed distribution by the investment entity to the transferor; and (b) the amount of the deemed distribution is the amount determined by the formula A × B ÷ C where A is the total of all amounts, each of which is the transferor’s proportionate share of the investment entity’s undistributed net GloBE income (determined without reference to the deemed distribution), immediately before the transfer, for a tested year that is any of the three fiscal years immediately preceding the transfer year, B is the value of the transferred ownership interest, and C is the total value of all the ownership interests in the investment entity.