Document ID: chunk:federal_register_of_legislation:F2024L01740:front:0:p75
Version: federal_register_of_legislation:F2024L01740
Segment Type: other
Provision Reference: 
Character Range: 187801–190527

rules (in addition to those mentioned in the note to the heading to Part 5‑1) apply if the MNE Group has any of the following:
(a) a Permanent Establishment: see section 5‑80;
(b) a Flow‑through Entity: see section 5‑85;
(c) an Ultimate Parent Entity that is subject to a Deductible Dividend Regime: see section 5‑90 and subsections 7‑20(7) and 7‑25(3);
(d) an Entity that becomes, or ceases to be, a Constituent Entity of the MNE Group during the Fiscal Year: section 6‑35.
 (2) However, the Substance‑based Income Exclusion Amount of an MNE Group for a jurisdiction for a Fiscal Year is taken to be zero if an election for the MNE Group under subsection (3) applies to the jurisdiction and the Fiscal Year.

Election
 (3) A Filing Constituent Entity for the MNE Group may make an election for the MNE Group under this subsection that applies to a specified jurisdiction.
 (4) An election under subsection (3) is an Annual Election.

Deemed election
 (5) If the GloBE Information Return filed for a Fiscal Year for an MNE Group by a Filing Constituent Entity for the MNE Group:
 (a) does not compute the Substance‑based Income Exclusion Amount for a jurisdiction; or
 (b) does not claim the Substance‑based Income Exclusion Amount for a jurisdiction in the computation of Jurisdictional Top‑up Tax for the jurisdiction;
the MNE Group is taken to have made an election under subsection (3) that applies to the jurisdiction and Fiscal Year.
 (6) If an MNE Group is taken, under subsection (5), to have made an election, the election cannot be revoked.

5‑55  Payroll Carve‑out Amount
 (1) The Payroll Carve‑out Amount for a Constituent Entity of an MNE Group located in a jurisdiction, for a Fiscal Year, is computed as follows:
 (a) first, compute the total amount of Eligible Payroll Costs accrued for the Fiscal Year of Eligible Employees of the Constituent Entity;
 (b) next, exclude from that total amount the Eligible Payroll Costs, to the extent they are:
 (i) capitalised and included in the carrying value of Eligible Tangible Assets for the Fiscal Year of a Constituent Entity of the MNE Group; or
 (ii) included in the Constituent Entity's International Shipping Income Costs or Ancillary International Shipping Income Costs for the Fiscal Year, and excluded from the computation of the Constituent Entity's GloBE Income or Loss for the Fiscal Year under section 3‑220;
 (c) next, multiply the result of paragraph (b) by 5%.
 (2) However, for the purposes of paragraph (1)(a), if, in the Fiscal Year:
 (a) an Eligible Employee performs activities for the MNE Group both in the jurisdiction and outside the jurisdiction; and
 (b) the proportion of the Eligible Employee's time spent performing those activities in the