Document ID: chunk:federal_register_of_legislation:F2024L01740:front:0:p94
Version: federal_register_of_legislation:F2024L01740
Segment Type: other
Provision Reference: 
Character Range: 235378–237984

of that amount in relation to the Fiscal Year in which the triggering event occurs;
 (b) if the election is a Five‑Year Election—include one fifth of that amount in relation to the Fiscal Year in which the triggering event occurs and in relation to each of the subsequent 4 Fiscal Years.
 (8) If paragraph (7)(b) applies, and the adjusting Constituent Entity ceases to be a Constituent Entity of the MNE Group in a Fiscal Year (the leaving year) that is one of the 5 Fiscal Years mentioned in that paragraph, then despite that paragraph:
 (a) include one‑fifth of the amount mentioned in subsection (5) in relation to the Fiscal Year in which the triggering event occurs; and
 (b) include one‑fifth of that amount in relation to each of the subsequent 4 Fiscal Years that end before the leaving year; and
 (c) include any remaining part of that amount in relation to the leaving year.

Part 6‑4—Joint Ventures

6‑75  Joint Ventures
 (1) This section applies to a Joint Venture of an MNE Group (the actual group) and its JV Subsidiaries (if any).
 (2) For the purposes mentioned in subsection (3):
 (a) treat the Joint Venture and its JV Subsidiaries (each of which is a JV Entity) as Constituent Entities that comprise a separate MNE Group (the deemed group); and
 (b) treat the Joint Venture as the Ultimate Parent Entity of the deemed group.
Note: The JV Entities are not Constituent Entities of the actual group, as their assets, liabilities, income, expanses and cash flows are not included in the Consolidated Financial Statements of the Ultimate Parent Entity of the MNE Group. Therefore, they are not part of the actual group for which Effective Tax Rate and Jurisdictional Top‑up Tax are computed.
 (3) The purposes are as follows:
 (a) computing the Top‑up Tax of the JV Entities;
 (b) determining whether each of the JV Entities is a Low‑Taxed Constituent Entity.
Note 1: For paragraph (a), to compute the Top‑up Tax of a JV Entity, it is necessary to compute the Effective Tax Rate and Jurisdictional Top‑up Tax of the deemed group for the jurisdiction in which it is located.
Note 2: The Top‑up Tax of a JV Entity is used to compute:
(a) the IIR Top‑up Tax Amount of a Parent Entity of the actual group that holds an ownership interest in the JV entity (see subsection 2‑5(4)); and
(b) the Domestic Top‑up Tax Amount of the JV Entity (see subsections 2‑25(5) to (8)); and
(c) the Total UTPR Top‑up Tax Amount of the actual group (see paragraph 2‑55(1)(b)).
Note 3: For paragraph (b), to determine whether a JV Entity is a Low‑Taxed Constituent Entity, it is necessary to compute the Effective