5‑75 Meaning of Eligible Tangible Asset5‑75 Meaning of Eligible Tangible Asset

5‑75 Meaning of Eligible Tangible Asset

(1) Eligible Tangible Asset, of a Constituent Entity located in a jurisdiction, means any of the following: (a) property (including plant and equipment) located in the jurisdiction that are owned by the Constituent Entity; (b) natural resources located in the jurisdiction that are owned by the Constituent Entity; (c) the Constituent Entity’s right of use, as a lessee, of tangible assets located in the jurisdiction; (d) a licence or similar arrangement from a government for the use by the Constituent Entity of immovable property in the jurisdiction, or exploitation of natural resources in the jurisdiction, that entails significant investment in tangible assets. (2) If the Constituent Entity holds part of a property mentioned in paragraph (1)(a) for lease and retains the other part of the property for its own use: (a) for the purposes of this Part, treat the parts of the property as separate Eligible Tangible Assets; and (b) allocate the carrying value of the property between those parts on a just and reasonable basis. (3) However, an asset is not an Eligible Tangible Asset at any time during a Fiscal Year if it is used in the generation of a Constituent Entity’s International Shipping Income for the Fiscal Year.