PART 1 | Short title and commencement |
1.—(1) This Act is the Multinational Enterprise (Minimum Tax) Act 2024.| (2) A provision of this Act does not come into operation except on a date and in the manner mentioned in subsection (3). |
| (3) The Minister may, from time to time, by order in the Gazette, declare that this Act or any provision thereof comes into operation on a date specified in the order, and this Act or that provision (as the case may be) comes into operation on that date and remains in force until the order is revoked by the Minister. |
| (4) The order must state the first financial year of an MNE group in relation to which the Act or provision (as the case may be) has effect. |
| (5) The Minister may, by an amendment to the order, declare that a provision of this Act that is in force because of subsection (3) ceases to be in force from (and including) a specified date. |
| (6) An order in subsection (3) or (5) may prescribe such provisions of a saving or transitional nature that are consequential to the coming into operation of the Act or a provision thereof, or the ceasing in force of a provision of the Act. |
| (7) All orders made under this section must be presented to Parliament as soon as possible after publication in the Gazette. |
(8) References in subsections (2), (3) and (6) to this Act and any provision thereof —| (a) | include all regulations made under section 84, or regulations made under that section that are relevant to that provision and specified in the order, as the case may be; and | | (b) | exclude sections 85 and 86, which are to come into operation on a date that the Minister appoints by notification in the Gazette. |
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2.—(1) In this Act —“acceptable financial accounting standard” means —| (a) | the International Financial Reporting Standards (IFRS) published by the International Accounting Standards Board (IASB); | | (b) | the generally accepted accounting principles of Australia, Brazil, Canada, Member States of the European Union, Member States of the European Economic Area, Hong Kong (China), Japan, Mexico, New Zealand, the People’s Republic of China, the Republic of India, the Republic of Korea, Russia, Singapore, Switzerland, the United Kingdom, or the United States of America; or | | (c) | any other financial accounting standard treated as an “acceptable financial accounting standard” under the GloBE rules; |
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| “adjusted covered taxes” has the meaning given by paragraph 1 of the First Schedule; |
| “authorised financial accounting standard”, in relation to an entity, means a set of generally acceptable accounting principles permitted by the body responsible for prescribing, establishing or accepting accounting standards for financial reporting purposes in the jurisdiction the entity is located in; |
“chargeable entity” means —| (a) | in relation to any MTT (including an amount of MTT payable pursuant to an assessment under section 49, 50(2) or 51) — the entity chargeable with the MTT under section 12; | | (b) | in relation to —| (i) | any DTT payable in respect of an MNE group for a financial year (including an amount of DTT payable pursuant to an assessment under section 49, 50(3) or 51); or | | (ii) | the balance thereof after deducting any part (amount Y) that an entity (X) is to pay pursuant to an election under section 45, including any addition to amount Y as mentioned in section 45(8), |
| the designated local DTT filing entity of the MNE group; and |
| | (c) | in relation to amount Y — X; |
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| “Comptroller” means the Comptroller of Income Tax, and includes, for all purposes of this Act except the exercise of the powers conferred upon the Comptroller by section 73 or 75, a Deputy Comptroller or Assistant Comptroller appointed under section 3(1) of the ITA; |
| “consolidated financial statements” has the meaning given by paragraph 2 of the First Schedule; |
“constituent entity” means an entity that is part of a group, and includes —| (a) | a permanent establishment of a main entity that is part of a group where the permanent establishment and the main entity are located in different jurisdictions; and | | (b) | an entity treated as a constituent entity in accordance with paragraph 5 of the First Schedule, |
| but excludes an excluded entity; |
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“controlling interest” means an ownership interest in an entity such that the entity that is the interest holder —| (a) | in consolidated financial statements prepared by it in accordance with an acceptable financial accounting standard, consolidated the assets, liabilities, income, expenses and cash flows of the entity on a line‑by‑line basis (called in this definition a line‑by‑line consolidation) in accordance with that financial accounting standard, or was not required to do so solely on size or materiality grounds or on the ground that the entity is held for sale; or | | (b) | if the interest holder were required by the law or a regulatory body of the jurisdiction it is located in to prepare consolidated financial statements in accordance with an authorised financial accounting standard that is either an acceptable financial accounting standard or another financial accounting standard that is adjusted to prevent any material competitive distortion —| (i) | would have been required by that financial accounting standard to carry out a line‑by‑line consolidation in accordance with that financial accounting standard; or | | (ii) | would not have been required by that financial accounting standard to carry out a line‑by‑line consolidation in accordance with that financial accounting standard solely on size or materiality grounds or on the ground that the entity is held for sale, |
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| and a main entity is deemed to have a controlling interest in its permanent establishment; |
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| “covered tax” has the meaning given by paragraph 1(6) of the First Schedule; |
“designated local DTT filing entity” means an entity that has been —| (a) | designated as such under section 34(1) or (5) or section 33(7) (as applied by section 34(7)); or | | (b) | deemed by the Comptroller as such under section 34(3) or that provision as applied by section 34(7); |
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“designated local GIR filing entity” means an entity that has been —| (a) | designated as such under section 33(1), (5) or (7); or | | (b) | deemed by the Comptroller as such under section 33(3) or that provision as applied by section 33(8); |
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| “DTT” or “domestic top‑up tax” means the tax imposed under Part 3 in respect of an MNE group, and (to avoid doubt) includes an amount of that tax that an entity is to pay pursuant to an election under section 45; |
| “entity” has the meaning given by paragraph 3 of the First Schedule; |
“excluded dividends” means dividends or other distributions received or accrued in respect of a direct ownership interest in an entity, that is not —| (a) | a portfolio shareholding beneficially owned by the constituent entity concerned that received or accrued the dividends or other distributions for less than one year at the date of the distribution; or | | (b) | a direct ownership interest in an investment entity or insurance investment entity that is subject to an election under the regulations; |
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| “excluded entity” has the meaning given by paragraph 4 of the First Schedule; |
“excluded equity gain or loss” means any gain, profit or loss included in the FANIL of a constituent entity of an MNE group arising from —| (a) | gains and losses from changes in fair value of a direct ownership interest in another entity other than a portfolio shareholding; | | (b) | profit or loss in respect of a direct ownership interest in another entity included under the equity method of accounting; or | | (c) | gains and losses from a disposition of a direct ownership interest in another entity other than a portfolio shareholding; |
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| “FANIL” or “financial accounting net income or loss” has the meaning given by paragraph 6 of the First Schedule; |
| “filing entity” means a constituent entity of an MNE group that files a GloBE information return (whether in Singapore or in another jurisdiction) for the purpose of the MTT under this Act or a qualified IIR, as the case may be; |
“financial year” means —| (a) | an accounting period for which the ultimate parent entity of the MNE group prepares its consolidated financial statements; or | | (b) | in the case of consolidated financial statements in sub‑paragraph (d) of the definition of “consolidated financial statements” in paragraph 2 of the First Schedule — a calendar year; |
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| “GIR” or “GloBE information return” means a return under section 40, or an equivalent return made in a jurisdiction outside Singapore for the purpose of a qualified IIR; |
| “GloBE income or loss” has the meaning given by paragraph 6 of the First Schedule; |
“GloBE rules” means the rules set out in the document entitled “Tax Challenges Arising from the Digitalisation of the Economy — Global Anti‑Base Erosion Model Rules (Pillar Two)”, published by the Organisation for Economic Co‑operation and Development (OECD) on 20 December 2021, as amended from time to time, and as further explained in the following documents (as amended from time to time):| (a) | the document entitled “Tax Challenges Arising from the Digitalisation of the Economy — Commentary to the Global Anti‑Base Erosion Model Rules (Pillar Two)”, published by the OECD on 14 March 2022; | | (b) | the document entitled “Tax Challenges Arising from the Digitalisation of the Economy — Global Anti‑Base Erosion Model Rules (Pillar Two) Examples”, published by the OECD on 14 March 2022; | | (c) | the document entitled “Tax Challenges Arising from the Digitalisation of the Economy — Administrative Guidance on the Global Anti‑Base Erosion Model Rules (Pillar Two)”, published by the OECD on 2 February 2023; | | (d) | the document entitled “Tax Challenges Arising from the Digitalisation of the Economy — Administrative Guidance on the Global Anti‑Base Erosion Model Rules (Pillar Two), July 2023”, published by the OECD on 17 July 2023; | | (e) | the document entitled “Tax Challenges Arising from the Digitalisation of the Economy — Administrative Guidance on the Global Anti‑Base Erosion Model Rules (Pillar Two), December 2023”, published by the OECD on 18 December 2023; | | (f) | the document entitled “Tax Challenges Arising from the Digitalisation of the Economy — Consolidated Commentary to the Global Anti‑Base Erosion Model Rules (2023)”, published by the OECD on 25 April 2024; | | (g) | the document entitled “Tax Challenges Arising from the Digitalisation of the Economy — Global Anti‑Base Erosion Model Rules (Pillar Two) Examples”, published by the OECD on 25 April 2024; | | (h) | the document entitled “Tax Challenges Arising from the Digitalisation of the Economy — Administrative Guidance on the Global Anti‑Base Erosion Model Rules (Pillar Two), June 2024”, published by the OECD on 17 June 2024; | | (i) | any other prescribed document; |
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“group” —| (a) | means a collection of entities that are related through ownership or control such that the assets, liabilities, income, expenses and cash flows of each entity are —| (i) | included in the consolidated financial statements of the ultimate parent entity; or | | (ii) | excluded from the consolidated financial statements of the ultimate parent entity solely on size or materiality grounds or on the ground that the entity is held for sale; and |
| | (b) | includes a main entity and its permanent establishments where the main entity is located in one jurisdiction and one or more of the permanent establishments are located in a different jurisdiction, but only if the main entity is not a part of another group mentioned in paragraph (a); |
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| “insurance investment entity” has the meaning given by paragraph 7 of the First Schedule; |
| “intermediate parent entity” means a constituent entity of an MNE group (other than an ultimate parent entity, partially‑owned parent entity, permanent establishment, investment entity or insurance investment entity) that holds an ownership interest in another constituent entity of the same MNE group; |
| “investment entity” has the meaning given by paragraph 7 of the First Schedule; |
| “ITA” means the Income Tax Act 1947; |
| “ITA tax” means the income tax imposed under the ITA; |
| “material competitive distortion” means an application of a specific principle or procedure under a set of generally accepted accounting principles that results in a total variation greater than EUR 75 million (or its equivalent in other currency as determined under the regulations) in the financial year concerned, as compared to the amount that would have been determined by applying a principle or procedure of the International Financial Reporting Standards (IFRS) published by the International Accounting Standards Board (IASB) that corresponds to the firstmentioned principle or procedure; |
| “minimum rate” has the meaning given by section 7; |
| “minority‑owned constituent entity” and “minority‑owned subgroup” have the meanings given by paragraph 9 of the First Schedule; |
| “MNE group” means a group that has at least one entity or permanent establishment that is not located in the jurisdiction of the ultimate parent entity; |
| “MTT” or “multinational enterprise top‑up tax” means the tax imposed under Part 2; |
“multi‑parent group” means 2 or more groups where —| (a) | the ultimate parent entity of each group has entered into an arrangement of a type specified in the regulations; and | | (b) | at least one constituent entity of all the constituent entities of those groups is located in a different jurisdiction from that of the other constituent entities of those groups; |
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| “OECD Model Tax Convention” means the Model Tax Convention on Income and on Capital published by the Organisation for Economic Co‑operation and Development (OECD) on 18 December 2017, as amended from time to time; |
| “ownership interest” means a direct ownership interest as defined in subsection (5) or an indirect ownership interest as defined in subsection (6); |
“partially‑owned parent entity” means a constituent entity of an MNE group (other than an ultimate parent entity, permanent establishment, investment entity or insurance investment entity) —| (a) | that holds an ownership interest in another constituent entity of the same MNE group; and | | (b) | more than 20% of the ownership interests of whose profits (for the financial year concerned) is held (directly or indirectly) by persons that are not constituent entities of that MNE group; |
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| “portfolio shareholding” means direct ownership interests in an entity that are held by one or more constituent entities of an MNE group and that, in total, carry rights to less than 10% of the profits, capital, reserves, or voting rights of that entity at the date of distribution or disposition; |
| “qualified domestic minimum top‑up tax” means a tax imposed by the law of a jurisdiction other than Singapore that is prescribed in the regulations as being equivalent in effect as the DTT; |
| “qualified IIR” means a tax imposed by the law of a jurisdiction other than Singapore that is prescribed in the regulations as being equivalent in effect as the MTT; |
| “qualified UTPR” means a tax imposed by the law of a jurisdiction other than Singapore that is prescribed in the regulations as an undertaxed profits tax that is equivalent in effect as the tax imposed by the UTPR in the GloBE rules; |
| “qualifying competent authority agreement”, in relation to a jurisdiction, means an agreement between the competent authority of Singapore and the competent authority of that jurisdiction for the automatic exchange of GloBE information returns; |
| “regulations” means regulations made under section 84; |
| “relevant entity”, in relation to a chargeable entity, has the meaning given by section 12(d); |
| “section 29(b) entity” means an entity described in section 29(b); |
“special entity” means a constituent entity of a group that is —| (a) | an investment entity; | | (b) | an insurance investment entity; | | (c) | a minority‑owned constituent entity; or | | (d) | a stateless entity, |
| and includes a joint venture and a JV subsidiary; |
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| “stateless entity” has the meaning given by paragraph 10 of the First Schedule; |
“tax” means a compulsory unrequited payment to —| (a) | the central government of a jurisdiction or an agency whose operations are under that government’s effective control; or | | (b) | a state or local government; |
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“transition year”, in relation to an MNE group, means the first financial year —| (a) | the MNE group comes within the scope of the law of any jurisdiction imposing a qualified IIR or a qualified UTPR; or | | (b) | for which the MNE group is liable to be registered under Part 4, |
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“ultimate parent entity” means —| (a) | an entity that owns directly or indirectly a controlling interest in any other entity and is not owned, directly or indirectly with a controlling interest, by another entity; or | | (b) | the main entity of a group comprising the main entity and all of its permanent establishments, one or more of which are located in a different jurisdiction from that of the main entity, but only if the main entity is not a part of another group in paragraph (a) of the definition of “group”, |
| (c) | excludes an entity that is not to be regarded as an ultimate parent entity under subsection (2); but | | (d) | includes an entity regarded as an ultimate parent entity under subsection (3). |
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| (2) In this Act, a governmental entity that has as its principal purpose the purpose in paragraph 4(3)(b)(ii) of the First Schedule is not to be regarded as the ultimate parent entity of a group and is to be disregarded for the purposes of this Act. |
(3) Accordingly, an entity (A) which is not itself a governmental entity described in subsection (2), but in which such governmental entity has a controlling interest as a result of a direct ownership interest, is to be regarded as the ultimate parent entity of a group consisting of —| (a) | A itself; and | | (b) | the entities that A has a controlling interest in. |
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| “Joint ventures” and related expressions |
(4) In this Act —| (a) | “joint venture”, “standalone JV”, “JV group”, “entity of a JV group” and “JV subsidiary” have the meanings given by paragraph 8 of the First Schedule; and | | (b) | paragraph 8(1)(c) or (3)(d) of the First Schedule applies to determine if a joint venture (including one that is an entity of a JV group) or JV subsidiary is “connected to” an MNE group. |
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| Direct and indirect ownership interests |
(5) In this Act, an entity or individual (A) holds a direct ownership interest in an entity (B) if —| (a) | A has an interest (whether by way of shares or other security or otherwise) that gives rise to rights in a share of the profits, capital or reserves of B; and | | (b) | that interest would, ignoring any requirement to consolidate the assets, liabilities, income, expenses and cash flows of B in the consolidated financial statements of A, be accounted for as equity in those statements, |
| and in this Act, A is a “direct owner” of B. |
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(6) In this Act, an entity or individual (C) holds an indirect ownership interest in an entity (D) if C holds a direct ownership interest in —| (a) | an entity that holds a direct ownership interest in D; or | | (b) | an entity that holds (as a result of a single or repeated application of this subsection) an indirect ownership interest in D. |
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| Definitions for other terms |
| (7) Where a term in this Act has a meaning for accounting purposes, it has that meaning in this Act. |
| (8) Any term in this Act that is not defined in this Act but defined in the GloBE rules, has the meaning given to it in the GloBE rules, as explained or modified in the regulations. |
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| “Flow‑through entity”, “reverse hybrid entity” and meaning of fiscal transparency |
3.—(1) In this Act, an entity is a “flow‑through entity” to the extent it is fiscally transparent with respect to any of its income, expenditure, profit or loss —| (a) | if it is established, formed, incorporated or registered under the laws of Singapore — under the ITA; or | | (b) | if it is established, formed, incorporated or registered under the laws of a jurisdiction other than Singapore — under the law of that jurisdiction governing income tax or tax of a similar nature, |
| but not if it is a tax resident of, and its income or profit is subject to a covered tax under the law of, another jurisdiction. |
| (2) In this Act, a flow‑through entity is a “reverse hybrid entity” with respect to any of its income, expenditure, profit or loss attributable to its direct owner, if it is not fiscally transparent with respect to that income, expenditure, profit or loss under the law of the jurisdiction in which the owner is located. |
| (3) In this Act, an entity is “fiscally transparent” under the law of a jurisdiction if that law 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 that owner’s interest in that entity. |
(4) Any obligation, debt or liability in this Act of a flow‑through entity is that of —| (a) | in the case of a partnership or limited partnership —| (i) | for an obligation other than a debt or liability — the precedent partner (as defined in section 71(1) of the ITA); | | (ii) | for a debt or liability — the partners or limited partners (as the case may be) on a joint and several basis; |
| | (b) | in the case of a limited liability partnership — the limited liability partnership; or | | (c) | in the case of a trust — the trustee. |
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| “Permanent establishment” and “main entity” |
4.—(1) In this Act, a “permanent establishment” is —| (a) | a place of business (including a deemed place of business under an applicable tax treaty in force) situated in a jurisdiction where it is treated as a permanent establishment in accordance with an applicable tax treaty in force, but only if the income attributable to it in accordance with a provision similar to Article 7 of the OECD Model Tax Convention is subject to tax under the law of that jurisdiction; | | (b) | if there is no applicable tax treaty in force — a place of business situated in a jurisdiction (including a deemed place of business under the law of that jurisdiction) in respect of which the law of that jurisdiction imposes a tax on the income attributable to it on a net basis similar to the manner in which tax residents of that jurisdiction are taxed; | | (c) | if a jurisdiction has no corporate income tax system — a place of business situated in that jurisdiction (including a deemed place of business under the law of that jurisdiction) that would be treated as a permanent establishment in accordance with the OECD Model Tax Convention, but only if that jurisdiction would have had the right to tax the income attributable to it in accordance with Article 7 of the OECD Model Convention; or | | (d) | a place of business (or a deemed place of business under the law of the jurisdiction where the main entity is located) that is not one in paragraphs (a), (b) and (c), through which operations are conducted outside the jurisdiction where the main entity is located, but only if the law of that jurisdiction exempts from tax income attributable to such operations. |
| (2) In this Act, a “main entity”, in relation to a permanent establishment, is the entity that includes the FANIL of the permanent establishment in its financial statements. |
| (3) For the purposes of this Act, a permanent establishment is treated as an entity that is distinct from the main entity it is a permanent establishment of (whether or not that is the case) and any other permanent establishment of the main entity. |
| (4) Any right, obligation, debt or liability in this Act of a constituent entity that is a permanent establishment is that of its main entity. |
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| Jurisdiction where entity or permanent establishment is located |
5.—(1) For the purposes of this Act, an entity (not being a flow‑through entity) is located in a jurisdiction if —| (a) | it is a tax resident of that jurisdiction based on its place of management, establishment, formation, incorporation, registration or similar criteria under the laws of that jurisdiction; or | | (b) | in a case where it is not a tax resident of any jurisdiction — it is established, formed, incorporated or registered under the laws of that jurisdiction. |
(2) For the purposes of this Act, a flow‑through entity that —| (a) | is the ultimate parent entity of an MNE group; or | | (b) | would be a responsible member of an MNE group as defined in section 13 (other than the ultimate parent entity of that MNE group) if it were located in the jurisdiction under the laws of which it is established, formed, incorporated or registered, |
| is located in the jurisdiction under the laws of which it is established, formed, incorporated or registered. |
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| (3) For the purposes of this Act, a flow‑through entity to which subsection (2) does not apply is treated as a stateless entity. |
(4) For the purposes of this Act, a permanent establishment is located in a jurisdiction if —| (a) | in the case of a permanent establishment in section 4(1)(a) — it is treated as a permanent establishment under the law of that jurisdiction and is taxed in accordance with an applicable tax treaty in force; | | (b) | in the case of a permanent establishment in section 4(1)(b) — it is subject to net basis taxation under the law of that jurisdiction based on its business presence there; and | | (c) | in the case of a permanent establishment in section 4(1)(c) — it is situated in that jurisdiction. |
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| (5) A permanent establishment in section 4(1)(d) is considered a stateless permanent establishment. |
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| Jurisdiction where entity is located: 2 or more jurisdictions |
6.—(1) This section applies where an entity (X) is located in 2 or more jurisdictions in a financial year under section 5(1).| (2) If there is an applicable tax treaty in force between 2 of these jurisdictions, X is located in the jurisdiction that it is deemed to be a resident of under that treaty. |
(3) If —| (a) | the applicable tax treaty in subsection (2) requires the competent authorities of the 2 jurisdictions to reach a mutual agreement on the residence of the entity but no agreement exists, or that treaty does not provide relief or exemption from tax for X because it is a resident of both jurisdictions; or | | (b) | there is no applicable tax treaty in force between the 2 jurisdictions, |
| (c) | X is located in the jurisdiction where it paid the greater amount of covered taxes, excluding any tax paid under a controlled foreign company tax regime, for the financial year; | | (d) | if the amount of covered taxes paid by X in each jurisdiction for the financial year is the same or nil, X is located in the jurisdiction where it has the greater amount of substance‑based income exclusion for the financial year as determined in accordance with section 18 for X as if X were the only constituent entity of its MNE group in that jurisdiction; and | | (e) | if the amount of X’s substance‑based income exclusion mentioned in paragraph (d) for each jurisdiction for the financial year is the same or nil, X is treated as a stateless entity unless X is the ultimate parent entity of its MNE group, in which case X is located in the jurisdiction under the laws of which X is established, formed, incorporated or registered. |
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(4) In subsection (2) or (3), if —| (a) | one of the jurisdictions is Singapore; | | (b) | X would (but for this subsection) be located in the other jurisdiction as a result of that subsection; | | (c) | that other jurisdiction does not impose a qualified IIR for the financial year; and | | (d) | X would be a chargeable entity under section 12 if it were located in Singapore for the financial year, |
| then X is located in Singapore for the financial year. |
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| (5) If the location of an entity changes in a financial year, it is located for that financial year in the jurisdiction where it is located at the beginning of that financial year. |
| (6) In subsection (3)(c), “controlled foreign company tax regime” means any law (other than a law imposing MTT or a qualified IIR) under which an entity (A) with an ownership interest in another entity (B) located in a different jurisdiction from A, is subject to current taxation on A’s share of part or all of B’s income, whether or not any of that income is distributed to A. |
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| 7. The minimum rate is 15%. |
| MNE group to which this Act applies |
8.—(1) This Act applies to an MNE group for a financial year beginning on or after 1 January 2025 if its consolidated group revenue (determined by reference to the consolidated financial statements of its ultimate parent entity) for at least 2 financial years out of the 4 financial years immediately before that financial year, is equal to or exceeds the threshold in subsection (2).(2) The threshold for a financial year is the amount computed by the formula  where —| (a) | A is EUR 750 million or its equivalent in other currency as determined under the regulations; and | | (b) | B is the number of months in the financial year. |
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(3) The Minister may make regulations under section 84 —| (a) | to prescribe adjustments to be made to the consolidated group revenue of an MNE group for any financial year for the purpose of subsection (1) in the event of any prescribed change to the composition of the MNE group; and | | (b) | to provide for what is to be included or excluded in the computation of the consolidated group revenue of an MNE group under subsection (1), and how such consolidated group revenue is to be determined. |
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9.—(1) Unless otherwise specified in subsection (3) or (4) or in the regulations, calculations under this Act in relation to an MNE group, or a constituent entity of the group, are to be carried out in the following currency (called in this section the presentation currency):| (a) | the currency used to prepare the consolidated financial statements for the financial year concerned of the ultimate parent entity; | | (b) | where no such statements were prepared, the currency in which such statements would have been prepared in accordance with paragraph 2(d) of the First Schedule. |
| (2) Where it is necessary to convert an amount into the presentation currency for any purpose under this Act, the conversion must be made in accordance with the regulations. |
(3) Where all the constituent entities of an MNE group located in Singapore —| (a) | have the same financial year as the ultimate parent entity of the MNE group; | | (b) | prepare their financial statements for that financial year in accordance with the Accounting Standards made or formulated under Part 3 of the Accounting Standards Act 2007, where either —| (i) | they are required to do so under any written law in Singapore; or | | (ii) | the financial statements are audited by an external auditor; and |
| | (c) | use Singapore dollar as their functional currency in preparing those financial statements, |
| the calculations for the purposes of Part 3 in relation to the MNE group, or a constituent entity of the MNE group, are to be carried out in Singapore dollar. |
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(4) For the purposes of Part 3, subsection (3) applies to a standalone JV (X) or entities of a JV group (Ys) located in Singapore, that are each treated as a constituent entity of an MNE group located in Singapore under that Part, as if —| (a) | a reference in that subsection to all the constituent entities of an MNE group were to X or to Ys; | | (b) | the reference to the MNE group in paragraph (a) of that subsection were to the MNE group to which X or Ys are connected; and | | (c) | the reference in that subsection to “the group, or a constituent entity of the group” were to X, and to the JV group or any Y, respectively. |
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(5) Where any entity in subsection (3) or (4) does not use Singapore dollar as its functional currency in preparing its financial statements, an election may be made for the calculations for the purposes of Part 3 in relation to the MNE group or JV group, or the standalone JV (as the case may be), to be carried out in either of the following currencies:| (a) | the currency used to prepare the consolidated financial statements of the ultimate parent entity or the joint venture of the JV group, or the financial statement of the standalone JV, as the case may be; | | (b) | Singapore dollar. |
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(6) The conversion of an amount in the functional currency in subsection (5) into —| (a) | the currency in subsection (5)(a), where an election is made under subsection (5) for that currency; or | | (b) | Singapore dollar, where an election is made under subsection (5) for that currency, |
| must be made in accordance with the regulations. |
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| (7) An election under subsection (5) must not be revoked for the financial year with respect to which it is made or for any of the subsequent 4 financial years, and any such revocation has no effect. |
| (8) If an election under subsection (5) is revoked for a financial year, another election under that subsection must not be made (whether in Singapore or in another jurisdiction) in respect of the constituent entities located in Singapore for that or any of the subsequent 4 financial years, and any such election has no effect. |
| (9) The amount of any MTT or DTT payable is to be denominated in Singapore dollars, and for this purpose an amount of top‑up tax for a financial year that is in the presentation currency (not being Singapore dollar) is to be converted into Singapore dollars in accordance with the regulations. |
(10) For the purpose of comparing an amount to a figure expressed in this Act in euros —| (a) | the amount if not in the presentation currency (and even if it is in euros), is to be converted first into the presentation currency in accordance with the regulations; and | | (b) | the amount in the presentation currency (not being euros) is then to be converted into euros in accordance with the regulations. |
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| Act to be construed as one with ITA |
10.—(1) This Act charges taxes on the income of MNE groups, known as the MTT and the DTT.| (2) This Act is to be construed as one with the ITA. |
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