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

Produced by a Tolley Corporation Tax expert

Corporation Tax

Guidance

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:

•
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
•
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, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Popular Articles

Corporation Tax

Foreign exchange issues

Foreign exchange issuesOverview of foreign exchange provisionsForeign exchange (FX) movements are generally taxed following the rules applicable to the underlying income, expenditure, asset or liability on which they arise, broadly as follows:Capital assetsOn a realisation basis (ie on disposal)

14 Jul 2020 11:44 | Produced by Tolley Read more

Value Added Tax

Exemption ― burial and cremation

Exemption ― burial and cremationThis guidance note provides an overview of the VAT treatment of services that are provided in connection with the burial or cremation of human remains.VAT treatmentThe following services are exempt from VAT:•the disposal of the remains of the dead•making arrangements

14 Jul 2020 11:38 | Produced by Tolley Read more

Value Added Tax

Reverse charge ― buying in services from outside the UK

Reverse charge ― buying in services from outside the UKThis guidance note covers the reverse charge that applies to services that have been bought in from outside the UK. For an overview of VAT and international services more broadly, see the International services ― overview guidance note. For

15 Dec 2020 14:02 | Produced by Tolley Read more

��Ƶ