The global minimum tax rate under the GloBE Rules is set to transform the tax landscape for multinational enterprises (MNEs). As tax authorities seek to reduce tax avoidance and profit-shifting practices, MNEs must navigate a new era of transparency and compliance.
The introduction of Pillar Two brings a new perspective to the way tax accounting is perceived. Where Pillar Two already assumes two key factors, being that intercompany transactions are taking place at arm’s length and the financial accounting is correct, a follow-up point of attention is tax accounting. Given the nature of the GloBE rules, classification of items through tax accounting is the key input to your Pillar Two calculation.
Subsequently, with the introduction of a global minimum tax, MNEs must reevaluate their tax strategies to comply with the new regulations. This will likely involve assessing their effective tax rates in different jurisdictions and potentially adjusting their business structures and operations.
In this webinar, our expert speakers will delve into the challenges and opportunities this transformation brings to the relationship between Pillar Two and tax accounting within MNEs. They explore how financial and tax reporting practices must adapt to reflect the changing international tax landscape.
Navigating Pillar Two - Webinar Series
Download the webinar recording and accompanying slides below, as they provide valuable insights into the complexities of Pillar Two, as well as jurisdiction-specific case study examples to enhance your understanding of the GloBE Rules.
Webinar Agenda:
Understanding Pillar Two and its mechanisms
- Get a comprehensive overview of the Pillar Two initiative and its objectives.
- Learn about the key elements and mechanisms that constitute the Global Anti-Base Erosion proposal.
- Explore the recent developments and adoption status of Pillar Two in different jurisdictions.
The interaction between Pillar Two, Tax Accounting, and QDMTT
- Delve into the specific implications of Pillar Two on tax accounting for MNE’s.
- Understand how the introduction of a global minimum tax can influence tax strategies.
- Discover the challenges and complexities that may arise in maintaining compliant tax accounting practices.
Speakers
Raymund Gerardu, CFO, TPA Global
Jasper Verkamman, Associate, TPA Global
Raj Balgobind, Tax & Technology Director, TIF Synergy
Pillar Two Top Up Tax Calculations Template
In order to illustrate the impact of Pillar Two Model Rules on Tax Accounting, our professionals with over 2 years of experience in running Pillar Two projects, have created an Excel calculation template that focuses on the fundamental steps of the Pillar Two Model, which include the calculation of:
- GloBe income;
- Covered taxes;
- GloBE Effective Tax Rate;
- Top-up tax Rate.
This calculation template guides you through the key elements of the Top-Up Tax Calculation at the level of the Ultimate Parent Entity, involving two constituent entities in different tax jurisdictions.