A new tax bill proposes amendments to the Danish Pillar Two law to incorporate new elements from the OECD Administrative Guidance and to further clarify the Pillar Two rules.
- The proposed bill includes the incorporation of the OECD January 2025 Administrative Guidance, which provides additional guidance on the application of article 9.1. of the OECD Model Rules. This includes related amendments to the transitional country-by-country (CbC) reporting safe harbour and qualified domestic minimum top-up tax (QDMTT) safe harbour.
- Additionally, the bill incorporates elements from the OECD June 2024 Administrative Guidance, addressing rules on allocating cross-border current and deferred tax expenses, and updated guidance on deferred tax liability (DTL) recapture rules.
- The proposed amendments also extend the payment deadlines for top-up taxes by one month. Under the current law, top-up taxes are required to be paid within 16 months after the last day of the reporting year (19 months for the transitional year). The draft law would extend these deadlines to 17 months after the last day of the reporting year (20 months for the transitional year).
Comments on the proposed amendments are due by March 3, 2025. If enacted, the amendments would enter into force on July 1, 2025, and would apply to fiscal years starting on or after December 31, 2023.
Read a February 2025 report prepared by KPMG’s EU Tax Centre