168 Underlying profits of transparent and reverse hybrid entities
Finance (No 2) Act 2023 (2023 c 30) | Legislation

168  Underlying profits of transparent and reverse hybrid entities

(1)     This section applies where a member of a multinational group (“M”) is a flow-through entity.

(2)     An entity is a flow-through entity if—

(a)     it is regarded as tax transparent in the territory in which it is created, and

(b)     it is not subject to a covered tax on its profits in another territory [as a result of being tax resident in that territory].

(3)     A proportion of the underlying profits of M is to be allocated to each entity [or individual] (“O”) with an ownership interest in M in relation to which condition A or B is met.

(4)     The proportion to be allocated to O is equal to the proportional ownership interest O has in M in relation to which condition A or B is met (subject to subsection (7)).

(5)     Condition A is that—

(a)     O is not regarded as tax transparent in the territory in

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