Quick guide | Application of BEPS 2.0 Pillar Two: compliance obligations, challenges, and actions | August 2024

This Guide highlights potential challenges that may arise and outlines the necessary actions to comply with the new regulatory requirements.

More than 140 jurisdictions participating in the Organisation for Economic Co-operation and Development (OECD) Base Erosion and Profit Shifting (BEPS) 2.0 Inclusive Framework have agreed to a two-pillar solution to address the challenges of digitization and globalization in income taxation. Pillar Two of this solution mandates a global minimum tax (GMT) of 15% for multinational corporations with group revenues exceeding €750 million in at least two of the past four years.

On 29 November 2023, the Vietnam National Assembly passed Resolution No. 107/2023/QH15 regarding the implementation of Pillar Two (Resolution 107). This resolution has been in effect since 1 January 2024, and will be applicable from the fiscal year 2024 onwards. This marks Vietnam as one of the frontrunners in implementing the GMT. 

Scope

Resolution 107 covers both the Qualified Domestic Minimum Top-Up Tax (QDMTT) and the Income Inclusion Rule (IIR).

The rules apply to multinational enterprises (MNEs) with consolidated financial revenue of €750 million or more, for at least 2 years out of 4 years preceding the fiscal year, except for specific exclusions. Broadly, the QDMTT will be relevant to the Vietnamese constituent entities of large MNEs headquartered overseas. The IIR will apply to large MNEs headquartered in Vietnam, with overseas constituent entities. 

To assist you in familiarizing yourself with the new obligations, we are pleased to provide you with a quick guide titled Application of BEPS 2.0 Pillar Two: compliance obligations, challenges, and actions. The guide also highlights potential challenges that may arise and outlines the necessary actions to comply with the new regulatory requirements.