As the international tax landscape continues to evolve, staying informed about the latest developments is crucial for businesses operating across borders.
Here's a roundup of significant updates from November and December 2024 regarding Pillar Two, including insights into regulatory changes, compliance requirements, and implementation progress across various jurisdictions.
Australia Passes Legislation to Implement Global and Domestic Minimum Tax
On November 27, 2024, the Australian Parliament approved legislation to introduce a global and domestic minimum tax, now awaiting Royal Assent.
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IIR and DMT: Effective for fiscal years starting on or after January 1, 2024, requiring a 15% minimum tax on MNE groups meeting revenue thresholds.
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UTPR: Applies to fiscal years starting on or after January 1, 2025.
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Reporting Requirements: In-scope groups must file three returns: the GloBE Information Return, Australian GloBE Tax Return, and DMT Return.
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Accounting and Compliance: Amendments to accounting standards introduce temporary exceptions for deferred taxes and mandate disclosures of Pillar Two-related tax expenses. An immediate issue for MNEs will be the accounting required as of December 31, 2024, for financial statements due in the February reporting season. The first returns, however, won’t be due for lodgment with the ATO until June 30, 2026.
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Securitization Exemption: Securitization entities are excluded from joint liability for top-up taxes, aligning with OECD Administrative Guidance.
Australia’s legislation aligns with OECD Model Rules, ensuring compliance with global tax standards. The regulations apply retrospectively for fiscal years starting on or after January 1, 2024.
Austria Implements CbC Reporting Safe Harbour Regulation
On December 5, 2024, Austria published a regulation implementing key aspects of the OECD's December 2023 Administrative Guidance on transitional CbC Reporting Safe Harbour.
The regulation applies to financial years starting on or after December 31, 2023.
Cyprus Passes Global Minimum Tax Law
On December 12, 2024, the Cyprus House of Representatives approved the Global Minimum Tax Law, transposing the EU Minimum Tax Directive into national law. The IIR will apply from 2024, while the UTPR and DMTT take effect from 2025. This law introduces a parallel tax framework alongside Cyprus’ corporate income tax rules for in-scope groups.
France: New Decree on Pillar Two Filing Obligations
On December 5, 2024, France issued a decree detailing Pillar Two filing and notification requirements:
Germany: Revised Draft Law on Pillar Two and Annual Tax Act 2024
On December 6, 2024, Germany’s Ministry of Finance released a revised draft law amending the Minimum Tax Act, with feedback due by January 31, 2025.
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Safe Harbour Updates: Aligns with OECD December 2023 guidance, including anti-hybrid arbitrage rules (effective for financial years starting after December 31, 2024) and purchase price accounting clarifications.
On December 5, 2024, the Annual Tax Act 2024 was enacted, introducing further amendments to Pillar Two, CFC taxation, and withholding tax relief procedures.
Gibraltar Publishes Draft Global Minimum Tax Bill 2024
On December 10, 2024, Gibraltar published the Global Minimum Tax Bill 2024 to incorporate Pillar Two rules into domestic law, confirming a 15% minimum tax rate.
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DMTT: Effective for financial years starting on or after December 31, 2023, taxing 100% of local entities’ top-up tax (not limited to UPE ownership share). Cross-border taxes (e.g., CFC taxes) are excluded.
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Filing and Compliance: The GIR is due 15 months after fiscal year-end (18 months for the first year), with top-up tax payable by the same deadline. Local entities may appoint a designated filer, but all entities remain jointly liable. Exemptions apply if a GIR is filed in a jurisdiction with a Qualifying Competent Authority Agreement, provided a notification is submitted three months before the due date.
Guernsey Enacts Regulation to Implement Pillar Two Rules
On November 26, 2024, Guernsey passed regulations introducing a Domestic Minimum Top-Up Tax (DMTT) and a Multinational Top-Up Tax (MTT), effective from January 1, 2025.
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Registration and Filing: Registration is required within 12 months of the UPE’s first accounting period or 6 months of becoming a group member. GIR, DMTT, and MTT returns are due within 15 months of the fiscal year-end (18 months for the first year).
Hungary Publishes Pillar Two Amendments and Registration Form
On November 28, 2024, Hungary published legislative amendments and the final registration form for Pillar Two.
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Registration: Groups must provide details of Hungarian constituent entities and the UPE, with a 12-month registration deadline (e.g., December 31, 2024, for calendar-year taxpayers).
Isle of Man Enacts Pillar Two Legislation
On November 21, 2024, the Isle of Man passed the Global Minimum Tax (Pillar Two) Order 2024, enacting a DMTT and IIR effective from January 1, 2025.
Poland Enacts Pillar Two Legislation
On November 19, 2024, Poland published legislation aligning with the EU Minimum Tax Directive, effective for financial years starting December 31, 2024. Taxpayers may opt for early application from January 1, 2024, with UTPR effective from 2025. DMTT calculations must follow Polish GAAP.
Slovakia Adopts Amendments to Pillar Two Rules
On November 28, 2024, Slovakia approved amendments updating DMTT accounting standards, introducing a permanent Safe Harbour for non-material entities, and incorporating OECD Administrative Guidance.
Spain Submits Pillar Two Legislation to Senate
On November 25, 2024, Spain’s Congress approved Pillar Two legislation, introducing DMTT and IIR from January 1, 2024, and UTPR from January 1, 2025.
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Filing and Payment: GIR and Top-Up Tax must be filed and paid within 15 months of fiscal year-end (18 months for the first year). Penalties of up to €10,000 per omission apply, capped at 1% of group net turnover.
UK Publishes Guidance on Top-Up Tax Payments and Filing Entity Changes
On November 20, 2024, HMRC published guidance on top-up tax payments under DMTT and IIR, with payments due 15 months after fiscal year-end (18 months for the first year), no earlier than June 30, 2026. An online service for changing the filing entity was also launched, requiring notifications within six months of the change.
For a comprehensive overview of developments across 72 jurisdictions, we invite you to read more in our detailed overview.
Our team of tax experts worldwide stands ready to provide tailored guidance and assistance specific to your jurisdiction.
Read the Pillar Two - Implementation Status overview here.
