The Cabinet yesterday approved the Royal Decree adopting the implementing regulations under Law 7/2024 (dated December 20, 2024) which implements the OECD’s Pillar Two global minimum tax as provided under the EU Minimum Tax Directive 2022/2523. Read TaxNewsFlash
According to the related press release, the implementing regulations address:
- The rules for determining the tax base and adjusted covered taxes for the purposes of the top-up tax, in particular when the financial or fiscal years of the ultimate parent entity are not the same as those of the constituent entities of the multinational enterprise group or large-scale domestic group.
- The relevant adjustments for determining qualifying income or loss for the period and the rules for computing eligible tangible assets and eligible employees in respect of substance-based income exclusion.
- The starting point for calculating the deferred tax expense or income of a constituent entity by reference to the financial accounting net income or loss of the constituent entity in the relevant tax period, prior to consolidation adjustments arising from the elimination of intra-group transactions.
- The information return to be filed by the multinational enterprise group or large-scale domestic group and the penalty regime.
Read an April 2025 report prepared by the KPMG member firm in Spain