8‑125 Meaning of duplicate loss arrangem8‑125 Meaning of duplicate loss arrangement

8‑125 Meaning of duplicate loss arrangement

(1) A duplicate loss arrangement is an arrangement that results in an expense or loss being included in the financial statements of a Constituent Entity of an MNE Group located in a jurisdiction to the extent that: (a) the expense or loss is also included as an expense or loss in the financial statements of another Constituent Entity of the MNE Group; or (b) the arrangement also gives rise to a duplicate amount that is deductible for purposes of determining the taxable income of another Constituent Entity of the MNE Group located in another jurisdiction. (2) Despite paragraph (1)(a), an arrangement is not a duplicate loss arrangement to the extent that the amount of the expense or loss is offset against revenue which is included in the financial statements of both Constituent Entities. (3) Despite paragraph (1)(b), an arrangement is not a duplicate loss arrangement to the extent that the amount of the expense or loss is offset against revenue or income which is included in both: (a) the financial statements of the Constituent Entity including the expense or loss in its financial statements; and (b) the taxable income of the Constituent Entity claiming the deduction for the relevant expense or loss.