Document ID: chunk:federal_register_of_legislation:F2024L01740:front:0:p112
Version: federal_register_of_legislation:F2024L01740
Segment Type: other
Provision Reference: 
Character Range: 280164–282944

subsection 7‑145(1) applies to:
 (i) an Investment Entity that is a Constituent Entity of an MNE Group; and
 (ii) a Constituent Entity‑owner of the Investment Entity; and
 (iii) a Fiscal Year (the tested year); and
 (b) there is an Undistributed Net GloBE Income Account for the Investment Entity for the tested year with a balance above zero at the end of the third subsequent Fiscal Year (the reporting year).
 (2) In computing the Investment Entity's GloBE Income or Loss for the reporting year, include the Constituent Entity‑owner's proportionate share of the Undistributed Net GloBE Income Account for the Investment Entity for the tested year (the Constituent Entity‑owner's undistributed share).
 (3) For purposes of Chapter 2:
 (a) treat the Investment Entity as a Low‑Taxed Constituent Entity of the MNE Group for the reporting year; and
 (b) increase the Top‑up Tax of the Investment Entity for the reporting year by the amount that is:
 (i) the Constituent Entity‑owner's undistributed share;
  multiplied by:
 (ii) the Minimum Rate.

7‑160  Meaning of Undistributed Net GloBE Income Account
 (1) This section applies if:
 (a) an election under subsection 7‑145(1) applies to:
 (i) an Investment Entity that is a Constituent Entity of an MNE Group; and
 (ii) a Fiscal Year (the tested year); and
 (b) the Investment Entity has GloBE Income for the tested year.
 (2) At the end of the tested year, an Undistributed Net GloBE Income Account is established for the Investment Entity for the tested year.
 (3) At the end of the tested year, the balance of the Undistributed Net GloBE Income Account is the Investment Entity's GloBE Income for the tested year, reduced (but not below zero) by applying the following against that balance:
 (a) the Investment Entity's Covered Taxes (if any) for the tested year;
 (b) distributions and deemed distributions in the tested year to shareholders other than Constituent Entities that are Investment Entities.
 (4) For the purposes of subsection (5), this subsection covers a Fiscal Year if the Fiscal Year is the first, second or third Fiscal Year after the tested year.
 (5) At the end of a Fiscal Year covered by subsection (4), reduce the balance of the Undistributed Net GloBE Income Account for the Investment Entity for the tested year (but not below zero) by applying the following against that balance:
 (a) the Investment Entity's Covered Taxes (if any) for the Fiscal Year;
 (b) distributions and deemed distributions in the Fiscal Year to shareholders other than Constituent Entities that are Investment Entities;
 (c) if the Investment Entity has a GloBE Loss for the Fiscal Year—the GloBE Loss;
 (d) if the Investment Entity has a GloBE Loss for a previous Fiscal Year covered by subsection (3)—the GloBE Loss, to the