OECD: June 2024 administrative guidance on Pillar two

In June 2024, the OECD published a fourth set of agreed administrative guidance on the OECD's global anti-base erosion (GloBE) model rules for a global minimum corporate tax.

The OECD published consolidated commentary, together with consolidated examples, on the GloBE model rules, which form the main element of Pillar two, in April 2024. This further guidance will be incorporated into the consolidated version of the Pillar two commentary and covers a number of specific topics within the rules including the following:

• The rules around deferred tax liability recapture
• The rules around determining deferred tax assets and liabilities methodology where there is a difference between the accounting and GloBE carrying values
• Allocating cross-border current taxes
• Allocating cross-border deferred taxes
• Allocating profits and taxes in some flow-through tax structures
• Treatment of securitisation vehicles under a jurisdiction's domestic minimum top-up tax.

Commentary to the GloBE rules was originally released in March 2022. The Commentary explains the intended outcomes under the GloBE Rules, clarifies the meaning of certain terms and illustrates the application of the rules to certain fact patterns. The Consolidated Commentary published incorporated Agreed Administrative Guidance that has been released by the Inclusive Framework since March 2022 up until December 2023. The OECD is expected to continue to publish further commentary and guidance on the GloBE rules.

Further information on the guidance can be found on the OECD website.