Global Daily Tax News, Ireland Issues Multinational Top-Up Tax Guidance, (May 20, 2024)

The Irish Revenue has released new guidance on Irish domestic legislation for the implementation of the Pillar Two framework ensuring large multinational entities are liable to a corporate tax rate of at least 15 percent.

The minimum tax was introduced in Section 94 of Finance (No.2) Act 2023, which inserted a new Part 4A of the Taxes Consolidation Act (TCA) 1997.

The provisions implement the Pillar Two minimum effective tax rate for large groups and companies by transposing the EU Minimum Tax Directive (Council Directive (EU) 2022/2523 of December 14, 2022), into Irish law.

Tax and Duty Manual – Part 4a-01-02 contains an overview of the main Pillar Two charging rules along with a detailed correlation table which cross references the legislation contained in Part 4A of the TCA 1997 with:

• The relevant article of the EU Minimum Tax Directive;

• The relevant article of the OECD Model Rules;

• OECD Commentary, where relevant; and

• OECD Administrative Guidance, where relevant.

The Revenue said: "Revenue is engaging with the Tax Administration Liaison Committee (TALC), specifically the TALC BEPS sub-committee, in respect of areas of guidance on the Pillar Two rules. This Tax and Duty manual will be expanded in due course to include further guidance on the Pillar Two rules contained in Part 4A of the TCA 1997."