GTL Summary:

Ministerial Decision No. 55 of 2025 establishes Kuwait's DMTT framework under Decree-Law No. 157 of 2024. Article 39 provides for a 'GloBE Loss Election', an alternative to the standard loss treatment specified in Article 38. A Domestic Constituent Entity (DCE) can make this election with its first GloBE Information Return (GIR) or tax return. This election establishes a Deferred Tax Asset (DTA) for any net GloBE loss, calculated by multiplying the net GloBE loss by the minimum tax rate, aligning with OECD Pillar Two principles.

Document Type: ERS - Executive Regulations
Law: QDMTT Law (Decree-Law no. 157 of 2024)
Decision Number: executive-regulations-55-article-39
Year: 2025
Country: 🇰🇼 Kuwait
Official Name: Article 39 - GloBE Loss Election
Last updated at: 2026-02-23 12:13:40 UTC

CHAPTER 4 - CALCULATION OF ADJUSTED COVERED TAXES

Article 39 - GloBE Loss Election

A DCE may elect to apply the GloBE Loss Election in the State instead of applying the provisions of Article 38 of these ERs, provided that the election is submitted with either the first GIR for the MNE Group or the Tax Return filed in the State, whichever is earlier.

If this election is made, a DTA for GloBE losses is created for each Tax Period in which a net GloBE loss exists in the State, calculated as follows:

DTA for GloBE Loss = Net GloBE Loss × Minimum Tax Rate

The DTA for GloBE losses must be carried forward to subsequent Tax Periods and adjusted downward by the amount utilized in any of those periods. This asset must be used in any subsequent Tax Period in which a net GloBE income arises in the State, equal to the lesser of:

  1. Net GloBE Income × Minimum Tax Rate

  2. The amount available under a DTA in relation to GloBE Loss

If the GloBE Loss Election is later revoked, the remaining DTA for GloBE losses shall be reduced to zero, effective from the first day of the Tax Period in which the election is no longer applicable.

A Flow-through Entity that serves as the UPE of an MNE Group may also make a GloBE Loss Election under this Article. In such a case, the DTA for GloBE loss is calculated in accordance with the above paragraphs in this Article, considering the allocations specified in paragraph (2) of Article 55 of these ERs.

Net GloBE Loss in the State means the zero or negative amount, if any, calculated as:

Net GloBE Loss = GloBE Income of All CEs – GloBE Losses of All CEs

GloBE Income of all CEs means the total GloBE income of all CEs located in the State, as determined in accordance with Chapter 3, for the relevant Tax Period.

GloBE Losses of all CEs means the total GloBE losses of all CEs located in the State, as determined in accordance with the provisions of Chapter 3, for the relevant Tax Period.

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