UK to Apply Transitional CbCR Safe Harbour Anti-Avoidance Rule From March 14, 2024
On March 14, 2024, the UK Government confirmed it is to apply an anti-avoidance rule for the purposes of the Transitional CbcR Safe Harbour from March 14, 2024.
Contents
General
On March 20, 2023, the German Federal Ministry of Finance published a consultation, including a draft law (the Minimum Taxation Directive Implementation Act), to implement the EU Global Minimum Tax Directive. The consultation is open for comments until April 21, 2023.
The draft legislation is very comprehensive and, as expected, covers all relevant aspects of the EU Global Minimum Tax Directive.
In particular, it provides for an Income Inclusion Rule (IIR) for financial years beginning after December 30, 2023 and the Under-Taxed Payments Rule (UTPR) for financial years beginning after December 30, 2024.
The draft legislation also includes a Qualifying Domestic Minimum Top-Up Tax (for financial years beginning after December 30, 2023) which reflects the latest design guidance in the OECD Administrative Guidance.
In addition, safe harbours, as reflected in the OECD Safe Harbour Guidance are also reflected in the draft legislation.
The structure of the legislation is:
Part 1: General Provisions/Definitions
Part 2: IIR/UTPR
Part 3: Determination of GloBE Income or Loss
Part 4: Determination of adjusted taxes
Part 5: Determination of the effective tax rate and the top-up tax
Part 6: Business restructuring and shareholding structures
Part 7: Special features of ultimate parent companies, distribution regimes and investment units
Part 8: Administration
Part 9: Special provisions for the transitional year, the transitional period and the initial phase
Part 10: Qualified domestic minimum top-up tax (QDMTT)
Part 11: Procedures and Penalties
This layout is pretty much identical to the EU Minimum Tax Directive, with the addition of two new chapters for the QDMTT and procedures and penalties.
Application
If you haven’t got a subscription you can sign up below
On March 14, 2024, the UK Government confirmed it is to apply an anti-avoidance rule for the purposes of the Transitional CbcR Safe Harbour from March 14, 2024.
We track the implementation of key aspects of the Transitional CbCR Safe Harbour in draft and enacted domestic laws issued to date back to the OECD Safe Harbours Guidance and the OECD Administrative Guidance.
Analysis of the domestic implementation of the Pillar Two Global Minimum Tax rules in Belgium for accounting periods beginning on or after December 31, 2023. Updated for the Draft Law to amend the ‘Act on the introduction of a minimum tax for multinational enterprise groups and large domestic groups’ of March 6, 2024.
The substance-based income exclusion favours capital intensive and certain low profit margin companies. These companies stand to benefit the most.
English Translation of the Belgian Draft Global Minimum Tax Amendment Law
On March 6, 2024, the Belgian Government submitted a draft law to Parliament which includes provisions to amend the GloBE Law to implement aspects of the OECD Administrative Guidance.
On March 7, 2024, the Australian Taxation Office provided an update on the implementation of Pillar Two.
Analysis of the implementation of the Pillar Two Global Minimum Tax rules in the UK on or after 31 December 2023. Updated for the 2024 Finance Act.
Updates to our QDMTT Legislative Tracker to include domestic QDMTT legislation released up to March 6, 2024.
In most cases, a Qualifying Refundable Tax Credit will result in a higher Pillar Two effective tax rate than a non-qualifying tax credit. However, this is not always the case. We look at some examples in this article.
Analysis of the domestic implementation of the Pillar Two Global Minimum Tax rules in Thailand for accounting periods beginning on or after January 1, 2025. Updated for the Draft Law issued on March 1, 2024.
On March 1, 2024, the Thai Revenue Department published an 18-page consultation paper on the implementation of Pillar Two. This includes draft legislation which includes, an IIR, UTPR and a domestic minimum tax.
Cookie | Duration | Description |
---|---|---|
cookielawinfo-checkbox-analytics | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Analytics". |
cookielawinfo-checkbox-functional | 11 months | The cookie is set by GDPR cookie consent to record the user consent for the cookies in the category "Functional". |
cookielawinfo-checkbox-necessary | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookies is used to store the user consent for the cookies in the category "Necessary". |
cookielawinfo-checkbox-others | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Other. |
cookielawinfo-checkbox-performance | 11 months | This cookie is set by GDPR Cookie Consent plugin. The cookie is used to store the user consent for the cookies in the category "Performance". |
viewed_cookie_policy | 11 months | The cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. It does not store any personal data. |