Singapore legislation
Regulation 57
Regulation 57
Eligible payroll costs and eligible tangible assets of permanent establishment
Subregulation 1
Subject to section 18(7) and paragraphs (2) and (3), the following adjustments are to be made to the eligible payroll costs for a financial year, and the eligible tangible assets, of a permanent establishment for the purposes of section 18(6):
treat any eligible payroll costs and eligible tangible assets that are taken into account in determining the FANIL of the permanent establishment in paragraph 6(6) of the First Schedule to the Act, as those of the permanent establishment;
exclude any eligible payroll costs and eligible tangible assets that are not taken into account in determining the FANIL of the permanent establishment in paragraph 6(6) of the First Schedule to the Act;
treat any eligible payroll costs and eligible tangible assets that are taken into account in determining the FANIL of the permanent establishment in paragraph 6(7) of the First Schedule to the Act, as nil.
Subregulation 2
Where a proportion of the FANIL for a financial year of a constituent entity of an MNE group that is —
a permanent establishment (X) of a flow‑through entity (D) that is the ultimate parent entity of the MNE group; or
a permanent establishment (also X) of a flow‑through entity (E) through which E wholly or partly carries out its business, where —
E is treated as fiscally transparent in the jurisdiction where D is located; and
the ownership interests in E are held by D directly or through one or more flow‑through entities (each of which is treated as fiscally transparent in the jurisdiction where D is located),is excluded from X’s FANIL under paragraph 6(12)(d) of the First Schedule to the Act, that same proportion of X’s eligible payroll costs or carrying value of X’s eligible tangible assets (as the case may be) for that financial year is not treated as X’s eligible payroll costs or carrying value of X’s eligible tangible assets, as the case may be.
Subregulation 3
For the purposes of section 18(2) and (3), where —
a proportion of the FANIL for a financial year of a flow‑through entity (F) (being the ultimate parent entity of the MNE group) is allocated to a permanent establishment (Y) of F under paragraph 6(12)(e) of the First Schedule to the Act; and
the eligible employees or eligible tangible assets of F are located in the same jurisdiction as Y,the same proportion of F’s eligible payroll costs or carrying value of F’s eligible tangible assets (as the case may be) for that financial year is also allocated to Y.