Singapore legislation
Regulation 27
Regulation 27
Allocation of loss to main entity
Subregulation 1
Where, after making the adjustments in these Regulations (other than this regulation), the FANIL for a financial year of a constituent entity of an MNE group that is a permanent establishment is a loss, the loss is to be allocated to the main entity of the permanent establishment to the extent that the loss —
is treated as an expense of the main entity for the computation of tax in the jurisdiction where it is located; and
is not set off against income that is subject to tax under the laws of both the jurisdictions where the permanent establishment and the main entity are located.
Subregulation 1A
Chapter 3.2.2 of the June 2024 Administrative Guidance applies for the purpose of determining the extent that a loss mentioned in paragraph (1) is treated as an expense of the main entity for the computation of tax in the jurisdiction where it is located.
Subregulation 2
Where an amount of loss (A) has been allocated to the main entity of a permanent establishment in paragraph (1) and, in a subsequent financial year, the permanent establishment has a positive amount of FANIL after making the adjustments in these Regulations (other than this regulation), the FANIL of the permanent establishment for that financial year is to be allocated from the permanent establishment to the main entity of the permanent establishment until an amount of the FANIL of the permanent establishment equal to A is allocated to the main entity of the permanent establishment (in that or subsequent financial years).