Understanding BEPS Pillar Two

DTT and what it means for you

6 February 2023 | 3 minute read

Insights

It has been more than a year since the Singapore government first announced that a domestic minimum tax was being considered.

In the 2023 Budget, it was further announced that Singapore plans to implement the Global Anti-Base Erosion rules and a domestic top-up tax (DTT) for in-scope businesses from the financial year beginning on or after 1 January 2025, subject to international developments.

What should taxpayers do if they are approached for feedback?

Although the government is bound by international rules in terms of how DTT is designed, it is possible that there is some leeway to facilitate implementation and administration.

Businesses should therefore be frank and forthcoming with their feedback, particularly if they foresee practical issues in implementation and challenges in data gathering and meeting timelines.

The takeaway

Compliance with the Pillar Two rules is expected to be a massive data gathering and compliance exercise for in-scope MNEs, even if their Singapore tax liability remains unchanged eventually. It is therefore in their interest to proactively identify and feedback to the government any practical issues in data gathering or reporting, implementation and meeting timelines so that these may be addressed, to the extent possible, before the rules take effect in 2025.

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QDMTT and what it means for you

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Lennon Lee

Tax Leader, PwC Singapore

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Tan Ching Ne

Partner and Corporate Tax Leader, PwC Singapore

+65 9622 9826

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Irene Tai

Partner, Corporate Tax, PwC Singapore

+65 9756 8439

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Paul Lau

Partner, Financial Services Tax, PwC Singapore

+65 8869 8718

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Rose Sim

Tax Reporting and Strategy Leader, PwC Singapore

+65 9623 9817

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Tan Tay Lek

Partner, Corporate Tax, PwC Singapore

+65 9179 2725

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