Taxes Consolidation Act 1997 section 111D

Location of constituent entity

Section 111D sets out the rules for determining the jurisdiction in which a constituent entity is located for the purposes of Part 4A (Pillar Two).

• An entity (other than a flow-through entity) is located where it is tax resident based on place of management, creation, or similar criteria; if residence cannot be determined, the entity is deemed located where it was created.
• Flow-through entities are located where they were created if they are an ultimate parent entity or required to apply an IIR; otherwise, they are treated as stateless. Permanent establishments are located according to how and where they are taxed, or may be treated as stateless.
• Where an entity is resident in two jurisdictions, its location is determined first by any applicable tax treaty, then by which jurisdiction charged higher covered taxes, then by which jurisdiction produces the greater substance-based income exclusion, with the entity potentially being deemed stateless if all tiebreakers are equal.
• An entity's location, once determined at the start of a fiscal year, remains fixed for the entire year; a stateless entity is deemed located in a jurisdiction separate from any jurisdiction where another entity is located.

---