Pilíř 2 – nový pozměňovací návrh k novele zákona o dorovnávacích daních

Pillar 2 – new additions to the proposed amendment of Act on Top-up Taxes

As we have informed you before (HERE), the Act on Top-up taxes in its current wording should undergo significant changes, especially in order to qualify the Czech top-up tax as a QDMTT (qualified domestic minimum top-up tax) and QDMTT safe harbour. The actual text of the draft amendment is attached to the amendment to the Accounting Act and the Auditors Act in the Parliamentary Press 783, to which the related additions have also been newly added.

In addition to minor cosmetic changes to selected provisions, the addition to the draft amendment to the Act on Top-up Taxes contains some fundamental changes that reflect, for example, the new OECD Administrative Guidance issued in January.

Out of these changes, we would highlight the following:

• A modification of the CbCR safe harbour eligibility provisions for investment entities;
• Taking into account the new January 2025 OECD interpretation of the transitional provisions in relation to deferred tax assets associated with the so-called governmental arrangement;
• The election to include FX gains and losses arising from effective currency hedging instruments associated with ownership interests into excluded capital gains, i.e. effectively excluding them from the calculation of the GloBE income and excluding the associated tax from covered taxes.

For more information, please do not hesitate to contact the authors of the article or your EY team with whom you regularly work.

Authors:

Karel Hronek

Dominik Živný