Part 4 U.K.Domestic top-up tax

Chapter 3 U.K.Application of multinational top-up tax provisions

276 Application of transitional provision U.K.

The transitional provision in Schedule 16 applies in relation to domestic top-up tax as it applies in relation to multinational top-up tax as if—

(a) references in that Schedule to a multinational group were to a group;

[F1 (aa) where a qualifying member is a member of a group, for paragraph 3(2)(c) there were substituted—

“(c) the election has been made in respect of the territory for each preceding accounting period that commenced on or after 31 December 2023—

(i) in which the Pillar Two rules would, ignoring any transitional safe harbour election, have applied to any member of the group in the territory, and

(ii) in which any member of the group is a qualifying entity for the purposes of domestic top-up tax,”,]

(b) where a qualifying entity is a member of a group and all members of the group are located in the United Kingdom, the following provisions of that Schedule (which have no relevance in such a case) were omitted—

(i) paragraph 3(2)(b) and (d), and 3(7) [F2 to (9)] (country-by-country reporting);

(ii) the words “that are used for preparation of the group’s country-by-country report” in paragraph 4(2);

(iii) paragraph 4(5) (use of statements used for preparation of country-by-country report);

(iv) in paragraph 9(2), the words from “ignoring” to the end.

(c) where a qualifying entity is not a member of a group—

(i) references in that Schedule to a member of a group (however framed and including references to multiple members) were to a qualifying entity;

(ii) references in that Schedule (however framed) to the consolidated financial statements of the ultimate parent were to the qualifying financial statements of the entity;

(iii) paragraph 2 were omitted;

[F3 (iiia) for paragraph 3(2)(c) there were substituted—

“(c) the election has been made in respect of the territory for each preceding accounting period that commenced on or after 31 December 2023 in which the member was a qualifying entity for the purposes of domestic top-up tax,”,]

(iv) the provisions mentioned in paragraph (b)(i) to (iv) were omitted.

Textual Amendments

F1 S. 276(aa) inserted (22.2.2024 with effect for accounting periods beginning on or after 31.12.2023 in accordance with Sch. 12 para. 1(2) of the amending Act) by Finance Act 2024 (c. 3), Sch. 12 para. 45(2)(a)

F2 Words in s. 276(b)(i) substituted (22.2.2024 with effect for accounting periods beginning on or after 31.12.2023 in accordance with Sch. 12 para. 1(2) of the amending Act) by Finance Act 2024 (c. 3), Sch. 12 para. 29(3)

F3 S. 276(c)(iiia) inserted (22.2.2024 with effect for accounting periods beginning on or after 31.12.2023 in accordance with Sch. 12 para. 1(2) of the amending Act) by Finance Act 2024 (c. 3), Sch. 12 para. 45(2)(b)