Tax Transparency Election

Tax Transparency Election An entity can make a tax transparency election in respect of its ownership interest in an investment entity. This then changes the default tax treatment under the Pillar Two rules. For more information on the treatment of investment entities/funds under Pillar Two, see Investment Funds and Pillar Two The election is a […]

GloBE Loss Election

GloBE Loss Election Contents GloBE Loss Election GloBE Loss Election, Generally GloBE Loss Election – Example 1, No Corporate Income Tax GloBE Loss Election – Example 2, Low Corporate Income Tax GloBE Loss Election, Generally Instead of applying the deferred tax rules (or for instance in jurisdictions where there is a very low rate of […]

Consolidation Election

Consolidation Election Whilst consolidated financial accounts are used for determining whether MNE groups are in scope (see our Scope analysis), Pillar Two GloBE income is based on the entity-level financial accounts before any consolidation adjustments. As such, transactions between group entities are taken into account when determining the Pillar Two GloBE income or loss of […]

Capital Gains Election

Election to Spread Capital Gains A capital gains election allows an MNE group to spread gains and losses on sales of local immovable tangible assets over the current year and the previous four years and to match gains with losses. The intention behind this is to avoid volatility in the ETR calculation that could arise […]

Stock-Based Compensation Election

Stock Based Compensation Election Overview  Article 3.2.2 of the OECD Model Rules include an election (the ‘stock-based compensation election’) to replace the deductible amount of stock-based compensation in the financial accounts of the constituent entity with the amount deductible in its corporate income tax return. This applies to shares/stock and options and warrants related to […]