Document ID: chunk:federal_register_of_legislation:F2024L01740:reg:10:p8
Version: federal_register_of_legislation:F2024L01740
Segment Type: reg
Provision Reference: reg 10 (pt 8/10)
Character Range: 369813–372612

is a Qualified IIR; and
 (b) specifying a Tax, for a specified Fiscal Year, that is a Qualified Domestic Minimum Top‑up Tax; and
 (c) specifying a Tax, for a specified Fiscal Year, that is a Qualified UTPR.

10‑20  Direct Ownership Interest—interest differently classified
  For the purposes of subsection 38(3) of the Act, if:
 (a) a Constituent Entity of an MNE Group (the holder) holds an interest in another Constituent Entity of the MNE Group (the issuer); and
 (b) the holder has classified the interest as debt under the financial accounting standard used in the preparation of the relevant Consolidated Financial Statements; and
 (c) the issuer has classified the interest as equity under that financial accounting standard;
the interest is not a Direct Ownership Interest in the issuer.

Part 10‑2—Definitions of Securitisation Entity, Flow‑through Entity, Tax Transparent Entity, Reverse Hybrid Entity, and Hybrid Entity

10‑25  Meaning of Securitisation Entity
 (1) An Entity is a Securitisation Entity for a period if it meets the conditions in subsection 820‑39(3) of the Income Tax Assessment Act 1997 throughout the period.
 (2) To avoid doubt, subsections 820‑39(4) and (5) of that Act apply for the purposes of subsection (1) of this section.

10‑30  Meaning of Flow‑through Entity
  An Entity is a Flow‑through Entity to the extent it is fiscally transparent with respect to its income, expenditure, profit or loss in the jurisdiction where it was created unless it is tax resident and subject to a Covered Tax on its income or profit in another jurisdiction.
Note: A Constituent Entity may be treated as a Flow‑through Entity in accordance with section 10‑50.

10‑35  Meaning of Tax Transparent Entity
  A Flow‑Through Entity is a Tax Transparent Entity with respect to its income, expenditure, profit or loss to the extent that it is fiscally transparent in the jurisdiction in which its owner is located.
Note: A Constituent Entity may be treated as a Tax Transparent Entity in accordance with section 10‑50.

10‑40  Meaning of Reverse Hybrid Entity
  A Flow‑Through Entity is a Reverse Hybrid Entity with respect to its income, expenditure, profit or loss to the extent that it is not fiscally transparent in the jurisdiction in which the owner is located.

10‑45  Fiscal transparency and meaning of Tax Transparent Structure
 (1) For the purposes of this Part, treat an Entity as fiscally transparent under the laws of a jurisdiction, if that jurisdiction treats the income, expenditure, profit or loss of that Entity as if it were derived or incurred by the direct owner of that Entity in proportion to its interest in that Entity.
 (2) An Ownership Interest in an Entity or a Permanent Establishment that is a Constituent Entity is held through a Tax Transparent Structure