Document ID: chunk:federal_register_of_legislation:F2024L01740:front:0:p52
Version: federal_register_of_legislation:F2024L01740
Segment Type: other
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Character Range: 131409–134104

reduction in that paragraph to the extent that the Flow‑through Entity is owned by the Ultimate Parent Entity of the Group (directly or through a Tax Transparent Structure).
          Note: See Part 7‑1 for the rules dealing with an Ultimate Parent Entity that is a Flow‑through Entity.
 (3) To avoid doubt, if an amount of the Financial Accounting Net Income or Loss of the Flow‑through Entity is allocated to another Constituent Entity under subsection (1), the Financial Accounting Net Income or Loss of the Flow‑through Entity is reduced by that amount.
 (4) Subsection (1) applies separately with respect to each Ownership Interest in the Flow‑through Entity.

Chapter 4—Computation of Adjusted Covered Taxes

Part 4‑1—Adjusted Covered Taxes

4‑5  Meaning of Adjusted Covered Taxes
  The Adjusted Covered Taxes for a Fiscal Year of a Constituent Entity of an MNE Group is the Constituent Entity's Accrued Current Covered Tax Expense for the Fiscal Year, adjusted by:
 (a) adding its Additions to Covered Taxes for the Fiscal Year (see section 4‑15) and subtracting its Reductions to Covered Taxes for the Fiscal Year (see section 4‑20); and
 (b) adding the Total Deferred Tax Adjustment Amount for the Constituent Entity for the Fiscal Year (see Part 4‑4); and
 (c) adding any increase in Covered Taxes, and subtracting any decrease in Covered Taxes, that:
 (i) are recorded in equity or Other Comprehensive Income of the Constituent Entity for the Fiscal Year; and
 (ii) relate to amounts included in the computation of its GloBE Income or Loss for the Fiscal Year that will be subject to tax under the law of the jurisdiction in which it is located.

4‑10  Meaning of Accrued Current Covered Tax Expense
  The Accrued Current Covered Tax Expense for a Fiscal Year of a Constituent Entity of an MNE Group is the amount (if any) of the Constituent Entity's current tax expense accrued, in respect of Covered Taxes, in the Constituent Entity's Financial Accounting Net Income or Loss for the Fiscal Year.

4‑15  Meaning of Additions to Covered Taxes
  The Additions to Covered Taxes for a Fiscal Year of a Constituent Entity of an MNE Group is the sum of the following:
 (a) the amount (if any) of Covered Taxes of the Constituent Entity for the Fiscal Year accrued as an expense in the profit before taxation in the Constituent Entity's financial accounts for the Fiscal Year;
 (b) if:
 (i) there is a GloBE Loss Deferred Tax Asset of the MNE Group for the jurisdiction in which the Constituent Entity is located; and
 (ii) an amount of that GloBE Loss Deferred Tax Asset is used for the Fiscal Year under subsection 4‑125(2); and
 (iii) if there is a GloBE Loss Deferred Tax Asset of the