MTT31000 - Calculating top-up amounts: Calculating the total top-up amount of a member
Source: gov.uk (2025-08-05)


The top-up amount of a member of a group (other than an investment entity, see MTT45120 (https://www.gov.uk/hmrc-internal-manuals/multinational-top-up-tax-and-domestic-top-up-tax/mtt45120)) is determined by the following process.

Step 1: Determine the total top-up amount for the member’s territory (see MTT31010 (https://www.gov.uk/hmrc-internal-manuals/multinational-top-up-tax-and-domestic-top-up-tax/mtt31010)). If there is no total top-up amount for that territory, the top-up amount for the member will be nil.

Step 2: Determine the adjusted profits of the member (See MTT21000+ (https://www.gov.uk/hmrc-internal-manuals/multinational-top-up-tax-and-domestic-top-up-tax/mtt21000)). If the member has an adjusted loss or no adjusted profits, its top-up amount will be nil.

Step 3: Determine the adjusted profits for the period of all the other members of the group that are located in same territory as the member in question (See MTT21000+ (https://www.gov.uk/hmrc-internal-manuals/multinational-top-up-tax-and-domestic-top-up-tax/mtt21000)). If there are no other members located in the same territory, the member’s top-up amount is equal to the total top-up amount for the territory as determined at Step 1.

Step 4: Add together the adjusted profits of all members of the group in that territory that have profits (including those of the member in question).

Step 5: Divide the member’s adjusted profits by the result of Step 4.

Step 6: Multiply the total top-up amount for the territory (the result of Step 1) by the result of Step 5, to arrive at the top-up amount of the member.

This is set out in section 193 of Finance (No.2) Act 2023.

Domestic Top-up Tax

For DTT purposes, the top-up amounts of investment entities are to be included in the total top-up amount of the standard members. See MTT45210 (https://www.gov.uk/hmrc-internal-manuals/multinational-top-up-tax-and-domestic-top-up-tax/mtt45210).

For accounting periods beginning on or after 31 December 2024 or, where a retrospection election has been made, for accounting periods beginning on or after 31 December 2023 there is a different allocation of tax amounts under DTT. See MTT31100 (https://www.gov.uk/hmrc-internal-manuals/multinational-top-up-tax-and-domestic-top-up-tax/mtt31100)for more information.

Example

A group has three members in Territory Z. The total top-up amount for the territory is £7,000.

A Ltd has an adjusted profit of £100,000.

B Ltd has an adjusted loss of £50,000.

C Ltd has an adjusted profit of £25,000.

The top-up tax amount for each member is determined using the 6-step process.

Step 1: The total top-up amount is £7,000.

Steps 2 and 3: The adjusted profits of each member is above. B Ltd has an adjusted loss so its top-up amount will be nil.

Step 4: A Ltd and C Ltd have adjusted profits of £125,000.

Step 5: For A Ltd, adjusted profits of £100,000 are divided by £125,000, giving a ratio of 0.8.

For C Ltd, adjusted profits of £25,000 are divided by £125,000, giving a ratio of 0.2.

Step 6: The total top-up amount for the territory is £7,000.

For A Ltd, the result of step 5 (0.8) multiplied by this amount is £5,600.

For C Ltd, the result of step 6 (0.2) multiplied by this amount is £1,400.

These are the top-up amounts for A Ltd and C Ltd.

The top-up amount for B Ltd was determined to be nil at step 2 because it did not have adjusted profits.