UUÂãÁÄÖ±²¥

Pillar Two ― overview of the UK’s multinational top-up tax

Produced by a Tolley Corporation Tax expert
Corporation Tax
Guidance

Pillar Two ― overview of the UK’s multinational top-up tax

Produced by a Tolley Corporation Tax expert
Corporation Tax
Guidance
imgtext

Origins of the Pillar Two multinational top-up tax

In October 2021, over 135 jurisdictions signed up to a ‘two-pillar’ solution to reform the international taxation rules. The main aim is to ensure that large multinational enterprises (MNEs) pay a fair share of tax, no matter which territory they operate in. The two pillars are as follows:

  1. •

    Pillar One ― profits earned by large MNEs are reallocated to the market jurisdiction in which they have the most engagement, irrespective of whether or not the MNEs have a physical presence there

  2. •

    Pillar Two ― introduction of the Global Anti-Base Erosion (GloBE) rules, which require qualifying MNEs to pay tax at a minimum effective rate in every jurisdiction in which they operate, regardless of the main rate locally or the availability of local tax reliefs, by charging a top-up tax

The framework for Pillar One is still under consultation at OECD level, however the OECD’s Model Rules and Commentary on Pillar Two were published in December 2021 and March 2022 respectively.

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+â„¢
Powered by

Popular Articles

Bad debts

Bad debtsBad debts usually arise where goods or services have been provided to a customer, for which payment has not been received within a reasonable or specified time period, or for which the customer is unable to pay. It is necessary to determine the quantum of relief that can be claimed for bad

14 Jul 2020 15:34 | Produced by Tolley Read more Read more

Real estate investment trusts (REITs)

Real estate investment trusts (REITs)Introduction to REITsA real estate investment trust (REIT) is in fact not a trust at all, it is a company which qualifies for special tax treatment under CTA 2010, Part 12. REITs are similar in many ways to collective fund vehicles (such as unit trusts) in that

14 Jul 2020 13:04 | Produced by Tolley in association with Rob Durrant-Walker of Crane Dale Tax, part of AMS Group Read more Read more

Income tax paid on behalf of employee

Income tax paid on behalf of employeeIntroductionEmployers may wish to make payments of employment income to an employee / director without the employee suffering a tax or NIC cost on that pay. In other words, the employer wants to pay an amount net of tax and NIC. In some instances, often with

14 Jul 2020 11:58 | Produced by Tolley in association with Paul Tew Read more Read more