Document ID: chunk:federal_register_of_legislation:F2024L01740:front:0:p51
Version: federal_register_of_legislation:F2024L01740
Segment Type: other
Provision Reference: 
Character Range: 128920–131657

paragraph (a) as an expense of the Main Entity (and not of the Permanent Establishment), reduced by amounts (if any) treated as GloBE Income of the Main Entity under a previous operation of this paragraph.
 (3) In computing the extent to which the loss amount is treated under paragraph (2)(a) as an expense of the Main Entity (and not of the Permanent Establishment), disregard so much of the loss amount as is offset, under the law of the jurisdiction in which the Main Entity is located, by an amount in respect of GloBE Income for the Fiscal Year of another Permanent Establishment in respect of the Main Entity.

Part 3‑5—Allocation of income or loss from a Flow‑through Entity

3‑255  Constituent Entity that is a Flow‑through Entity—Financial Accounting Net Income or Loss
 (1) If a Constituent Entity of a Group is a Flow‑through Entity, deal with its Financial Accounting Net Income or Loss as follows:
 (a) first, reduce the amount of that Financial Accounting Net Income or Loss by the amount attributable to its owners that:
 (i) are not Group Entities of the Group; and
 (ii) hold a Direct Ownership Interest in the Flow‑through Entity, or hold an Indirect Ownership Interest in the Flow‑through Entity through a Tax Transparent Structure;
 (b) next, if there is a Permanent Establishment through which the business of the Flow‑through Entity is wholly or partly carried out, allocate the remaining Financial Accounting Net Income or Loss to the Permanent Establishment to the extent set out in Part 3‑4;
 (c) next, if the Flow‑through Entity is a Tax Transparent Entity that is not the Ultimate Parent Entity of the Group, allocate the remaining Financial Accounting Net Income or Loss to the Flow‑through Entity's Constituent Entity‑owners in proportion with their respective rights to a share of the profits of the Flow‑through Entity carried by Ownership Interests that they hold;
 (d) next, if the Flow‑through Entity is a Tax Transparent Entity that:
 (i) is the Ultimate Parent Entity of the Group; or
 (ii) would be the Ultimate Parent Entity of the Group if any Controlling Interest in the Tax Transparent Entity held by an Excluded Entity were disregarded; or
 (iii) is a Reverse Hybrid Entity;
  allocate the remaining Financial Accounting Net Income or Loss to the Flow‑through Entity.
 (2) Despite paragraph (1)(a):
 (a) do not make the reduction in that paragraph if the Flow‑through Entity is the Ultimate Parent Entity of the Group; and
 (b) do not make the 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