Part 3Multinational top-up tax
Chapter 5Covered tax balance
Dealing with deferred tax assets etc
186Deferred tax assets recorded at less than minimum rate
1
This section applies where the value of a deferred tax asset of a member of a multinational group—
a
is calculated on the basis of a tax rate of less than 15%, and
b
is attributable to an accounting period in which the member’s adjusted profits were a loss.
F12
But this section only applies in relation to a deferred tax asset of the member falling within subsection (1) if the filing member accounts for all such assets of the member in accordance with this section in an information return submitted to HMRC or a qualifying authority (see paragraph 10(5) of Schedule 14).
3
Subsection (4) applies where the loss for the accounting period upon which the value of that asset was calculated does not exceed the loss established on determining the member’s adjusted profits for that period.
4
Where this subsection applies, the asset is to be treated as having the value it would have if the tax rate upon which it was calculated were 15%.
5
Subsection (6) applies where the loss for the accounting period upon which the value of that asset was calculated exceeds the loss established on determining the member’s adjusted profits for that period.
6
The relevant part of the asset is to be treated as having the value of a deferred tax asset generated on the loss established on determining the member’s adjusted profits on the basis of a tax rate of 15%.
7
The “relevant part” of the asset means so much of the asset derived from an amount of loss that does not exceed the loss established on determining the member’s adjusted profits.
F28
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