Document ID: chunk:federal_register_of_legislation:F2024L01740:front:0:p100
Version: federal_register_of_legislation:F2024L01740
Segment Type: other
Provision Reference: 
Character Range: 250220–252932

or exceeds the dividend amount multiplied by the Minimum Rate; or
 (c) the recipient of the dividend is an individual and the dividend is a patronage dividend from a supply Cooperative.
 (4) For the purposes of subsections (2) and (3), an amount of a patronage dividend from a supply Cooperative is taken to be subject to Tax in the hands of the recipient of the dividend to the extent it reduces an expense or cost that is deductible in computing the taxable income of the recipient of the dividend.
 (5) If an Ultimate Parent Entity's GloBE Income for a Fiscal Year is reduced under subsection (2), reduce its Covered Taxes for the Fiscal Year as follows:
 (a) first, compute the amount by which:
 (i) the Ultimate Parent Entity's GloBE Income for the Fiscal Year after the reduction;
  falls short of:
 (ii) the Ultimate Parent Entity's GloBE Income for the Fiscal Year before the reduction;
 (b) next, compute the fraction that is:
 (i) that shortfall;
  divided by:
 (ii) the Ultimate Parent Entity's GloBE Income for the Fiscal Year before the reduction;
 (c) next, multiply the Ultimate Parent Entity's Covered Taxes for the Fiscal Year (other than any taxes paid on undistributed GloBE Income pursuant to the Deductible Dividend Regime itself, including taxes that are based on corporate equity or retained earnings) by that fraction.
The result of paragraph (c) is the amount of the reduction under this subsection of the Ultimate Parent Entity's Covered Taxes for the Fiscal Year.
 (6) If an Ultimate Parent Entity's Covered Taxes for the Fiscal Year are reduced under subsection (5) by an amount, reduce its GloBE Income for the Fiscal Year by that amount in addition to the reduction of that GloBE Income under subsection (2).
 (7) If:
 (a) an Ultimate Parent Entity's GloBE Income for the Fiscal Year is reduced under subsection (2); and
 (b) its Covered Taxes for the Fiscal Year are reduced under subsection (5);
reduce the Eligible Payroll Costs incurred in the Fiscal Year of its Eligible Employees and the carrying value for the Fiscal Year of its Eligible Tangible Assets by the amount computed by multiplying them by the fraction computed under paragraph (5)(b).

7‑25  Ultimate Parent Entity subject to Deductible Dividend Regime—reduce GloBE Income and Covered Taxes of other Constituent Entities
 (1) This section applies if:
 (a) the Ultimate Parent Entity of an MNE Group is subject to a Deductible Dividend Regime; and
 (b) the Ultimate Parent Entity holds:
 (i) a Direct Ownership Interest in a Constituent Entity of the MNE Group; or
 (ii) an Indirect Ownership Interest in a Constituent Entity of the MNE Group through a chain of other Constituent Entities of the MNE Group; and
 (c)