Document ID: chunk:federal_register_of_legislation:F2024L01740:front:0:p129
Version: federal_register_of_legislation:F2024L01740
Segment Type: other
Provision Reference: 
Character Range: 323670–326382

Fiscal Year if the MNE Group's Net GloBE Income for the jurisdiction for the Fiscal Year, computed in accordance with this Division, is equal to or less than the MNE Group's Substance‑based Income Exclusion Amount for the jurisdiction for the Fiscal Year.

Subdivision C—NMCE simplified calculations

8‑175  NMCE simplified calculations
 (1) This section applies if:
 (a) an election under subsection 8‑180(2) applies in relation to a Fiscal Year and a Constituent Entity of an MNE Group; and
 (b) the Constituent Entity is an NMCE for the Fiscal Year.
 (2) This section applies for the purpose of working out whether the MNE Group meets the tests mentioned in subsection 8‑155(2) for the Fiscal Year.

Simplified income calculation
 (3) Treat the NMCE's Total Revenue for a Fiscal Year as its GloBE Income or Loss for the Fiscal Year in the following computations:
 (a) in computing the MNE Group's Average GloBE Income or Loss for the jurisdiction for the Fiscal Year as mentioned in paragraph 8‑160(b) (SC De minimis test);
 (b) in computing the MNE Group's Effective Tax Rate for the jurisdiction for the Fiscal Year as mentioned in section 8‑165 (SC ETR test);
 (c) in computing the MNE Group's Net GloBE Income for the jurisdiction for the Fiscal Year as mentioned in section 8‑170 (SC Routine profits test).

Simplified revenue calculation
 (4) Treat the NMCE's Total Revenue for a Fiscal Year as its revenue for the Fiscal Year in the following computations:
 (a) in computing the MNE Group's GloBE Revenue for a Fiscal Year mentioned in paragraph 5‑110(3)(a);
 (b) as a result of paragraph (a), in computing the MNE Group's Average GloBE Revenue for a Fiscal Year as mentioned in paragraph 8‑160(a) (SC De minimis test).

Simplified tax calculation
 (5) Treat the NMCE's Income Tax Accrued (Current Year) for a Fiscal Year as its Adjusted Covered Taxes for the Fiscal Year in computing the MNE Group's Effective Tax Rate for the jurisdiction for a Fiscal Year as mentioned in section 8‑165 (SC ETR test).

8‑180  NMCE simplified calculations election
 (1) Subsection (2) applies if an election for an MNE Group under subsection 8‑155(3) applies in relation to a Fiscal Year and a jurisdiction.
 (2) A Filing Constituent Entity for the MNE Group may make an election for the MNE Group under this subsection that applies to a specified Constituent Entity of the MNE Group that is an NMCE for the Fiscal Year.
 (3) An election under subsection (2) is an Annual Election.

8‑185  Meaning of Non‑material Constituent Entity (or NMCE)
  A Non‑material Constituent Entity (or NMCE) is a Constituent Entity of an MNE Group for a Fiscal Year if:
 (a) where it is an Entity:
 (i) the Entity is not consolidated on