4‑40 Meaning of Covered Taxes4‑40 Meaning of Covered Taxes

4‑40 Meaning of Covered Taxes

(1) The Covered Taxes of a Constituent Entity of a Group means: (a) Taxes recorded in the financial accounts of the Constituent Entity in respect of: (i) its income or profits; or (ii) its share of the income or profits of a Constituent Entity of the Group, in which it holds an Ownership Interest; and (b) Taxes on distributed profits, deemed profit distributions and non‑business expenses imposed under an Eligible Distribution Tax System; and (c) Taxes imposed in lieu of a generally applicable corporate income tax; and (d) Taxes levied by reference to retained earnings and corporate equity, including a Tax on multiple components based on income and equity. (2) Despite subsection (1), Covered Taxes does not include any amount of the following: (a) Top‑up Tax accrued by a Parent Entity under a Qualified IIR; (b) Top‑up Tax accrued by a Constituent Entity under a Qualified Domestic Minimum Top‑up Tax; (c) any Tax under or as a result of the application of a Qualified UTPR; (d) a Disqualified Refundable Imputation Tax; (e) Taxes paid or accrued by an insurance company in respect of returns to policyholders.