E-News from KPMG’s EU Tax Centre

KPMG’s EU Tax Centre compiles a regular update of EU and international tax developments that can have both a domestic and a cross-border impact, with the aim of helping you keep track of and understand these developments and how they can impact your business. Today’s edition includes updates on:

• CJEU referral: CJEU to decide on the interpretation of several provisions of the DRM
• CJEU referral: Polish referral on fiscal neutrality in corporate restructuring measures
• OECD: List of signatories of the GIR MCAA updated
• Czechia: Amendments to Czech Minimum Tax Act published in the Official Gazette
• Malta: Regulations on the “elective tax” published
• Netherlands: Pillar Two Q&A published
• Portugal: Notification form (under Pillar Two) published in Portugal
• Belgium (court decision): Belgian lower court rules on beneficial ownership requirement in Belgian implementation of the IRD
• France (court decision): French Constitution Court on the constitutionality of digital service taxes
• Poland (court decision): Polish Supreme Court confirms that dividend withholding tax exemption does not require verification of beneficial ownership

CJEU to decide on the interpretation of several provisions of the DRM

On August 7, 2025, the Latvian District Administrative Court referred a preliminary question to the CJEU concerning the interpretation of the Directive 2017/1852 on tax dispute resolution mechanisms (DRM or the Directive).

The plaintiff, a Dutch company, sold its shares in several property-rich Latvian companies to another Latvian company. More than 50 percent of the value of the assets of the sold companies consisted of immovable property situated in Latvia. In accordance with Latvian domestic tax law, and following discussions with the Latvian tax authorities, the buyer withheld from the purchase price a sum equal to 3 percent of the transaction price, representing Latvian corporate income tax due by the seller. From a Dutch perspective, the proceeds of the sale transaction were within the scope of Dutch corporate income tax, but benefited from a participation exemption.

The plaintiff consulted with the Dutch tax authorities and challenged the tax treatment applied by the buyer. In its view, the provisions of the capital gains article of the double tax treaty concluded between Latvia and the Netherlands were applicable, and no tax should have been due in Latvia. Since the positions of the competent authorities differed, the Latvian tax authorities decided in 2021 to start the mutual agreement procedure under the DRM. However, the competent authorities were unable to reach an agreement on the interpretation of the treaty provisions within the three-year period provided by the DRM. As a result, the taxpayer requested the Latvian tax authorities to set up a dispute resolution advisory commission – per Article 6(1)(b) of the DRM. The Latvian tax authorities, however, refused to initiate the procedure on the ground that the facts of the case did not involve ‘double taxation’ within the meaning of the DRM, since the Netherlands had in fact exempted the sale proceeds. Therefore, according to the Latvian tax authorities, there was no actual taxation of the same income in two different Member States and, consequently, no obligation to establish an advisory commission.

The plaintiff challenged the refusal before the Latvian courts. The plaintiff argued that the Directive defines double taxation broadly, referring to situations where the same income is included in the tax bases of two or more Member States. Therefore, in the plaintiff’s view, this definition does not require that income actually be taxed twice, but only that it falls within the scope of taxation in two national tax systems.

The referring court expressed doubts about the correct interpretation of the DRM and referred the following questions to the CJEU:

• Whether Article 6(1)(b) of the DRM establishes a clear obligation that, if the authorities of two Member States fail to reach an agreement within the required period, an advisory commission must be established at the request of the affected taxpayer.
• Whether the term’ double taxation’ within the meaning of the DRM also covers situations where the same income falls under the tax systems of two Member States, even if that income is exempt from taxation in one of them.
• Whether the taxpayer retains the right to a dispute resolution advisory commission even if the CJEU concludes that the present case does not involve double taxation within the meaning of the DRM.

Polish referral on fiscal neutrality in corporate restructuring measures

On July 1, 2025, a request for a preliminary ruling was published in the Official Journal of the EU (case C-434/25). The request was raised by the District Administrative Court in Gliwice (Poland) on June 2, 2025, and concerns the corporate income tax implications of a partial division, and its compatibility with EU law, specifically:

• Article 8(2) of Directive 2009/133/EC¹ (the Merger Directive), which ensures fiscal neutrality for partial divisions by preventing taxation on the allotment of securities to shareholders, and
• Article 8(6) of the Merger Directive, which allows Member States to tax gains from the subsequent transfer of securities received. 

Before 2021, article 12(4)(12)(a) of the Polish Corporate Income Tax Act generally allowed shareholders to benefit from tax neutrality (i.e., no immediate taxation) on the value of shares received in exchange for mergers or divisions, in line with the Merger Directive, provided certain conditions were met. Effective from 2022, this provision was amended to limit tax neutrality, which now applies only if the shares in the company being merged or divided were not previously acquired or taken up as a result of an exchange of shares, or allotted as a result of another merger or division. In other words, if the shareholder had acquired their shares in the company being divided/merged as a result of a previous restructuring (merger, division, or exchange of shares), the tax neutrality does not apply. The value of the new shares received in the subsequent restructuring is then treated as taxable income.

On March 1, 2022, the plaintiff executed a partial division under Polish law, transferring part of its enterprise to another entity. In exchange, this entity issued new shares, which were allotted to the plaintiff as the sole shareholder. The plaintiff argued that no taxable income was generated under Polish law since the value of the shares allotted was not higher than the value recorded for tax purposes before the division. The Polish tax authority disagreed on the grounds that fiscal neutrality does not apply due to the prior acquisition of some of the shares through a merger.

The plaintiff in this case is contesting a tax ruling issued by the Director of the National Tax Information in Poland, claiming it violated the Merger Directive and EU law. The District Administrative Court annulled the tax ruling, finding that EU law should guide the interpretation of national provisions. However, the Supreme Administrative Court overturned this decision, stating that the lower court had failed to demonstrate a need to interpret the Merger Directive or identify specific conflicts between EU and Polish law.

The referring court has doubts about the compatibility of Polish law with the Merger Directive and Article 63(1) TFEU, which prohibits restrictions on the movement of capital within the EU. It seeks clarification on whether Article 8(2) of the Merger Directive precludes national provisions imposing additional conditions for fiscal neutrality, and whether Article 8(6) justifies limiting fiscal neutrality to the first restructuring measure and taxing subsequent similar transactions.

List of signatories of the GIR MCAA updated

On September 4, 2025, the OECD updated a list of jurisdictions that have signed the GloBE Information Return Multilateral Competent Authority Agreement (GIR MCAA), to include Switzerland, which signed the Agreement on August 28, 2025.

The list of 16 signatories now includes Austria, Belgium, Denmark, France, Ireland, Italy, Japan, South Korea, Luxembourg, the Netherlands, New Zealand, Portugal, Slovakia, Spain, Switzerland and the UK.

For previous coverage on the GIR MCAA list of signatories, please refer to E-News Issue 216. For previous coverage on the Swiss GloBE reporting regulations, please refer to E-News Issue 212. 

Amendments to Czech Minimum Tax Act published in the Official Gazette

On September 2, 2025, the bill on the amendments to the Act on Top-Up Taxes, providing for the implementation of the EU Minimum Tax Directive, received the President’s signature and was published in the Official Gazette.

The bill follows the version previously approved by the Czech Senate, including amendments to the extension of filing deadlines.

Notably, the bill confirms that, for the GloBE Information Return (GIR), the deadline is aligned with the OECD deadline, meaning that the GIR would need to be filed 15 months from the end of the reporting period (18 months for the transition year, i.e., June 30, 2026, for the 2024 calendar year). The same deadline applies for notifications due in case the GIR is filed in another jurisdiction where the group operates. Similarly, the bill confirms that local tax return filing and payment are due no later than 22 months after the end of the fiscal year, i.e., October 31, 2026.

For EU Minimum Tax Directive implementation purposes, the bill entered into force on the day after its promulgation, with a retroactive effect for tax periods starting from December 31, 2023.

For previous coverage, please refer to E-News Issue 215.

2026 Budget Plan proposes implementation of Pillar Two

On September 5, 2025, the Icelandic 2026 Budget Plan (available in Icelandic only) was announced and has been discussed for the first time in Parliament on September 11, 2025.

According to the plan, Iceland has decided to implement a global minimum tax and will complete the implementation in the second half of this year, with a planned entry into force in 2026. More specifically, it is planned that Iceland will introduce two top-up mechanisms similar to the OECD Model Rules, including:

• A 15 percent domestic minimum Effective Tax Rate for MNE groups in scope of the GloBE Rules in Iceland.
• A 15 percent minimum Effective Tax Rate allowing Iceland to tax profits of subsidiaries in low-tax jurisdictions, if these jurisdictions have not introduced a domestic minimum Effective Tax Rate and the parent company is Icelandic.

The plan further notes that it is expected that the implementation will bring increased tax revenue to the Icelandic treasury within 15 to 18 months after its entry into force, i.e., up until 2028.

For previous coverage on the status of implementation of Pillar Two in Iceland, please refer to E-News Issue 213. For a state of play of the implementation of Pillar Two, please refer to KPMG’s dedicated implementation tracker in Digital Gateway.

Guidance on online Pillar Two registration platform published

On September 5, 2025, Irish Revenue published detailed guidance related to the registration process for Irish minimum taxation purposes (Pillar Two). This publication follows the launch of the online platform which occurred on September 5, 2025.

Key takeaways include:

• The guidance provides details on who must register, including when and how to register for Pillar Two taxes. More specifically:
  • in-scope entities are required to register within 12 months after the last day of the first fiscal year during which an entity qualifies as a relevant entity (e.g. parent entity subject to the IIR, entity subject to the UTPR, or entity liable to the QDTT);
  • this implies that, where an entity with a fiscal year ending on or before December 31, 2024, becomes liable to Qualifying Domestic Top-up Tax (QDTT) or Income Inclusion Rules (IIR) top-up tax in 2024, it must register for QDTT and IIR top-up tax by December 31, 2025. Instead, an entity with a fiscal year ending on or before December 31, 2025, which becomes liable to Undertaxed Payments Rules (UTPR) top-up tax in 2025, must register for UTPR top-up tax by December 31, 2026;
  • failure to register may result in a penalty of EUR 10,000.
• The guidance provides details of other obligations once an entity is registered for Pillar Two taxes. More specifically:
  • how to manage group elections and Top-up Tax Information Return role assignments;
  • how to manage Pillar Two roles and groups.
• The guidance provides details on how to contact Revenue using MyEnquiries, also available on the ROS website. It is specified that all queries relating to Pillar Two taxes should be made via MyEnquiries.

For previous coverage on the Irish Pillar Two online registration platform, please refer to E-News Issue 216.

Regulations on the “elective tax” published

On September 2, 2025, the Maltese Government published the Final Income Tax Without Imputation Regulations (“Regulations)”, implementing a 15 percent “elective tax”. Based on the Regulations, an entity – defined as a company, including any body of persons that elects to be treated as a company or is deemed to be a company in accordance with the provisions - may elect to be taxed on its chargeable income at a 15 percent rate, as an alternative to the standard rules of the Maltese Income Tax Act, namely without the application of the imputation system. Main takeaways include:

• The 15 percent tax is final and not refundable or creditable, thus preventing shareholders or any other individuals from being able to claim tax refunds available under the standard rules of the Maltese Income Tax Act.
• The base on which the 15 percent tax is charged is the same base as computed under the standard income tax rules. This implies that the 15 percent final tax forms part of Malta’s standard income tax system.
• Profits taxed under the new Regulations are credited to the Final Tax Account, and any distributions made from this account do not qualify for tax refunds. Additionally, the 15 percent tax rate must not result in a tax liability lower than the tax that would be due after refunds under the standard refund system provisions.
• To qualify for the 15 percent final tax rate, a company is required to submit an election form to the Malta Revenue. The form is still pending publication. Once this election is made, the 15 percent final tax will be applicable for at least five consecutive years, after which the company may apply to revert to taxation under the standard provisions of the Maltese Income Tax Act.

The election may be made in respect of income accruing to or derived by the entity in the fiscal year preceding the year of assessment 2025 and subsequent years, i.e., as from basis year ending on December 31, 2024.

Please note that Malta elected for the deferred application of the IIR and UTPR and only transposed administrative requirements necessary for the functioning of the EU Minimum Tax Directive.

For more information, please refer to a report prepared by KPMG in Malta.

Pillar Two Q&A published

On September 2, 2025, non-binding guidance in the form of an Q&A document was issued by the tax authorities in the Netherlands. The guidance provides clarifications on different aspects of the Pillar Two rules in the Netherlands, including:

• scoping considerations (e.g., qualification of certain types of entities for GloBE purposes);
• applicable accounting standard for QDMTT purposes (e.g., where different Dutch group members use different local accounting standards);
• transfer pricing considerations (e.g., application of materiality thresholds for transfer pricing adjustments with respect to intra-group transactions, application of the arm’s length principle with respect to excluded income);
• treatment of prior-year adjustments (e.g., treatment of tax expense relating to a fiscal year prior to the application of the GloBE rules but that is recognized for accounting purposes in a fiscal year to which the GloBE rules apply);
• treatment of deferred taxes (e.g., where deferred taxes relate to items of income that are not included in the financial accounting net income or loss, where deferred tax assets have not been recognized in the accounts);
• treatment of taxes imposed under (blended) CFC regimes;
• application of the transitional Country-by-Country (CbyC) Reporting Safe Harbour (e.g., where a group acquires an entity in a jurisdiction where the group previously did not have any presence);
• administrative requirements (e.g., clarifications on how to complete certain sections of the GloBE Information Return (GIR).

It is noted that the Q&A document is not exhaustive and will be updated regularly to incorporate new questions and answers as well as new insights with respect to existing answers. In addition, it is clarified that the Q&A document is subject to any relevant changes in legislation, policy, or future administrative guidelines published by the OECD or the European Commission.

For more information, please refer to a report prepared by KPMG in the Netherlands.

2025 Tax Act published in the Official Gazette

On September 6, 2025, the 2025 Nigeria Tax Act was published in the Official Gazette of Nigeria. The 2025 Nigeria Tax Act introduces, among other measures, two top-up tax mechanisms similar to the OECD Model Rules, as well as specific CFC rules, for fiscal years starting on or after January 1, 2026.

For a previous coverage, please refer to E-News Issue 216.

Polish team against aggressive tax planning is now operational

On August 13, 2025, the Polish Ministry of Finance hosted the inaugural meeting of the “team against aggressive tax planning”. The task of this body is to prepare a report containing proposals for measures to combat aggressive tax planning in the corporate income tax area.

Furthermore, on August 14, 2025, the National Revenue Administration’s Competence center against aggressive tax planning in corporate income tax also formally began operations. This unit of the tax authority is tasked with detecting and neutralizing aggressive tax optimization schemes, as well as preparing proposals for legislative changes to restrict the use of aggressive tax strategies.

For further details, please see a report prepared by KPMG in Poland.

Notification form (under Pillar Two) published in Portugal

On September 2, 2025, the ordinance approving the notification form and the related instructions for Portuguese minimum taxation purposes was published in the Official Gazette and entered into force on the following day. For our previous coverage of the minimum taxation rules in Portugal, please refer to E-News Issue 203.

Key takeaways include:

• Under Portuguese minimum taxation law, each constituent entity located in Portugal and included in the scope of the GloBE Rules must submit the notification form to the Portuguese tax authorities within nine months (12 months for the transitional year) after the end of the fiscal year in which the group falls within the scope of the GloBE Rules or when there are any changes in the elements contained in the notification. This means that, for calendar year taxpayers, the notification is due by December 31, 2025.
• The notification must be submitted by electronic means, on the specific Finance Portal of the Portuguese tax authorities.
• In case the notification is submitted by a designated local entity, each of the other entities of the group located in Portugal shall be notified by electronic data transmission, to confirm the designation in the respective reserved area of the Finance Portal within 15 days from the date of notification.
• If the designation is not confirmed by one or more of the group entities located in Portugal, all group entities identified in the form are required to submit a new notification within 15 days from the date of initial notification.
• The notification remains valid for the subsequent fiscal years, unless changes occur within the group structure.
• In case of late or missing filing, penalties ranging between EUR 5,000 and EUR 100,000 may be imposed, together with a 5 percent daily penalty for each day of delay. Additionally, in cases of errors or omissions, penalties between EUR 500 and EUR 23,500 may apply, with relief available in the initial years subject to certain conditions. 

Update on Pillar Two guidance published

On September 1, 2025, HMRC issued guidance on determining which groups/ entities need to report Pillar Two Top-up Taxes in the UK (i.e., the UK Multinational Top-up Tax (MTT) and Domestic Top-up Tax (DTT)). The guidance clarifies that taxpayers must register for MTT and DTT if they have at least one UK entity and consolidated group annual revenues of at least EUR 750 million in two of the previous four accounting periods. MNE groups with only UK entities must register for DTT, while MNE groups with entities inside and outside the UK must register for both DTT and MTT.

Guidance on registering to report Pillar 2 Top-up Taxes clarifies that the filing member of an MNE group must register online on the HMRC website, where information about the registration process is provided. The filing member can be either the UPE or another group company nominated by the UPE.

For more information on the HMRC guidance manual, please refer to a report prepared by KPMG in the UK and our previous coverage in E-News Issue 216.

Belgian lower court rules on beneficial ownership requirement in Belgian implementation of the IRD

On August 12, 2025, a Belgian lower court (the Court) issued a judgment concerning the application of the EU Interest-Royalty Directive (IRD) to interest payments in back-to-back loan arrangements.

The dispute arose with respect to payments made by a Belgian company to its Luxembourg parent company between 2015 and 2019. The payments were made under a shareholder loan arrangement, and the Belgian company claimed a withholding tax exemption in Belgium based on the local implementation of the IRD. The Belgian tax authorities challenged the interest WHT exemption on the grounds that the Luxembourg parent company was not the beneficial owner of the interest, as required by the IRD. In the view of the Belgian tax authorities, the recipient Luxembourg parent company merely acted as an intermediary within a group financing structure.

Whilst the IRD includes a specific requirement that the recipient of the interest must be the beneficial owner of the income, the Court noted that the Belgian legislature, when implementing the IRD, chose to use the term "gerechtigde" (entitled party) rather than "uiteindelijk gerechtigde" (ultimate beneficial owner), as included in the IRD. Additionally, the French language version of the implementing law uses the term "bénéficiaire" (beneficiary), but in the Court’s view this does not alter its legal interpretation based on the Dutch version.

The Court held that, under Belgian law, the "gerechtigde" is understood as the legal owner or usufructuary of the claim, not necessarily the economic beneficial owner as defined in the IRD. In the Court’s view, the Belgian implementation therefore does not require the recipient to be the beneficial owner in the economic sense. The Court found that interpreting the Belgian law in line with the IRD’s beneficial ownership concept would be "contra legem" (against the law), as the wording and the principle of legal certainty in Belgian and EU law prevent such an interpretation.

Consequently, the Court ruled that interest payments made by the Belgian company to its Luxembourg parent company qualified for the Belgian withholding tax exemption, even though the Luxembourg entity might not be considered the beneficial owner under the IRD. The Court also found that the Belgian anti-abuse rule (GAAR) could not be applied to counter the mere flow-through of interest payments via back-to-back loans to the ultimate beneficial owner, as the structure and transactions reflected genuine economic activity and were not set up with the sole or the primary purpose of obtaining a tax advantage.

In light of the above, the Belgian Court ruled in favor of the taxpayer and annulled the withholding tax assessments issued by the tax authorities for the years under dispute. The judgment can be appealed to the higher instance court by the Belgian State.

French Constitution Court rules on the constitutionality of digital service taxes

On September 12, 2025, the French Constitutional Court (“the Court”) published a decision in a case challenging the French digital services tax (DST). The case was filed by several technology companies.

The DST rules were introduced on July 24, 2019. The law imposes a 3 percent tax on gross annual revenues derived from specific digital activities in France, including targeted advertising, the sale or transfer of user data, and the provision of online platforms enabling user interaction.

The DST applies only to large groups that exceed two thresholds: EUR 750 million in global annual revenues, and EUR 25 million in revenues from French activities. These thresholds are applicable at group level and include related entities regardless of domicile. The revenue base taxable in France is calculated according to activity linked to French users (e.g., identified by IP address), with certain digital services excluded, such as traditional e-commerce resales, streaming, and regulated content delivery.

The applicants argued that the digital services tax infringed the constitutional principles of equality before the law and fairness in public burdens. The applicants also claimed the definition of taxable services was arbitrary, since some digital activities were included while others were excluded without objective justification. In the applicant’s view, the fact that the thresholds were calculated at the group level and by combining different service categories, created unfair presumptions and disproportionate effects. Further, they contested the territorial rule allocating revenues to France through the ‘national presence coefficient’, arguing it misrepresented where value was created and broke with traditional taxation principles. Finally, they argued that applying the flat 3 percent tax rate from the first euro created sharp threshold effects, the tax risked double taxation alongside corporate income tax, and in practice the regime disproportionately targeted and discriminated against foreign digital companies. For more information on the reasoning of the applicant, please refer to E-News Issue 214.

The Constitutional Court upheld the constitutionality of the disputed provisions. The Court emphasized that the thresholds were applied to groups of companies and service categories to target large actors in the digital economy, without creating irrebuttable presumptions or unconstitutional inequalities. Regarding revenue allocation, the Court found the 'national presence coefficient' to be a reasonable way to link taxable revenues to French user activity, acknowledging the difficulty of applying traditional territorial taxation to digital services. The Court concluded that the 3 percent tax rate applied from the first euro of taxable revenue was not confiscatory and did not constitute unconstitutional double taxation. It dismissed complaints about threshold effects, finding the flat rate consistent with legislative objectives and not imposing disproportionate burdens. Finally, the Court rejected claims of discrimination against foreign companies, noting that the tax applied equally to all companies meeting the thresholds, regardless of nationality, ensuring no unequal treatment.

In conclusion, the Court held that the digital services tax is consistent with the Constitution. The Court confirmed that taxing revenues from certain digital services is a legitimate legislative choice, and that the design of the DST - its scope, thresholds, territorial attribution method, transitional rule, and rate - does not violate the constitutional principles of equality or fairness in public burdens.

For more information, please refer to a TaxNewsFlash prepared by KPMG in France.

Dutch Supreme Court issues a ruling on interest deduction in acquisition structures and the concept of ‘fraus legis’

On September 5, 2025, the Dutch Supreme Court issued a ruling in a case concerning the possibility to deduct interest on an acquisition debt. The case represents a long-running litigation that was brought in front of the Supreme Court for the second time

The case concerned a private equity investor that used a Dutch holding company (Dutch HoldCo) for the purpose of acquiring a Dutch company. The acquisition of the latter was financed by the Dutch HoldCo partly with a loan taken from its Luxembourg shareholder. The Luxembourg shareholder had in turn financed the acquisition by issuing Preferred Equity Certificates ('PECs') to its shareholders – including the private equity fund. After the acquisition, the Dutch HoldCo entered into a fiscal unity with the acquired company. The issue under dispute was whether the Dutch HoldCo could deduct interest expenses on the shareholder loan from its taxable profit. On a related note, due to fiscal unity, the interest expenses related to the acquisition would in fact reduce the corporate income tax burden of the acquired company.

In the earlier phase of the proceedings, the central question was whether the interest deduction should be refused on the basis of the anti-base erosion rules under the Dutch corporate income tax act (Section 10a CITA 1969). Under these rules, financing costs related to loans received from associated parties and used to acquire other companies represent an ‘intra-group (non-business motivated) diversion’ and are not deductible for tax purposes. At that stage of the proceedings, the Supreme Court held that the Luxembourg shareholder had not obtained the financing of the PECs from related entities – each shareholder to whom the PECs had been issued, held a shareholding interest that remained below the threshold to qualify as ‘related’. Therefore, in the Court’s view, the deductibility of the expenses could not be denied solely based on the anti-base erosion rules. For more details, please refer to E-news Issue 159.

The current proceedings were focused on whether a loan that had had successfully passed the business motivation test of the anti-base erosion rules could still be regarded as abusive under the Dutch fraus legis doctrine. The Supreme Court clarified that a loan for which rebuttal evidence has been successfully provided for the purposes of the anti-base erosion rules – i.e., business motivation, can still yield fraus legis. An exception only applies for loans that are provided by an entity with a pivotal financial function: if the loan is granted from such a pivotal financial function and passes the anti-base erosion test, then fraus legis would be excluded. The loan has to be granted on the basis of the pivotal financial function in the group, and the entity must not function as a conduit company in relation to the loan.

The Supreme Court also upheld the findings of the Amsterdam Court of Appeal regarding the assessment of whether the disputed loan structure was abusive. The Court noted that, for the fraus legis doctrine to apply, one of the requirements is that tax considerations for deducting the interest on shareholder loans must have been decisive. In the Supreme Court’s view, this condition was satisfied, as it was plausible that tax motives were the determining factor for entering into the shareholder loans.

The Supreme Court based its reasoning on the following considerations:

• The structure was established according to a predetermined plan. After the decision was made to acquire the Dutch target, two Luxembourg entities were interposed, which, as far as the Supreme Court could observe, acted merely as intermediaries.
• In the Supreme Court’s view, it was not demonstrated that the Luxembourg companies carried out any substantial (financial) activities. Based on the case documents, the Supreme Court held that neither the shareholder loans nor the Luxembourg entities served any function other than to create an interest expense.
• The interest expense eroded the taxable income of the acquired company, which was subsequently included in a fiscal unity with the taxpayer, thereby avoiding corporate income tax. In this regard, the Supreme Court concluded that the shareholder loans were unnecessary and that the acquisition structure was implemented in an artificial manner.

Based on the above, the Supreme Court held that allowing the deduction of interest on the shareholder loans would be contrary to the purpose and intent of the Dutch corporate income tax law as a whole. Therefore, the Supreme Court dismissed the taxpayer’s appeal and upheld the Court of Appeal’s decision to deny the interest deduction.

For more information, please refer to a report prepared by KPMG in the Netherlands.

Polish Supreme Court confirms that dividend withholding tax exemption does not require verification of beneficial ownership

On August 13, 2025, the Polish Supreme Administrative Court (Supreme Court) issued a judgment stating that the exemption from withholding tax under Article 22(4) of the Polish Corporate Income Tax Act (CIT Act), setting out the conditions under which dividends paid by a Polish company to another company based in Poland, the European Union, or the European Economic Area, does not require verification of whether the dividend recipient is its beneficial owner of the income within the meaning of the CIT Act. The beneficial owner is defined as the entity that receives income for its own benefit (not as an intermediary or agent), has the right to decide how to use the income and bears the economic risk related to it, and - if the payment is related to business activity - carries out genuine business activity in its country of residence.

The case concerned a Polish company paying dividends to a shareholder based in Germany. The Director of the National Tax Information argued that, following amendments to the CIT Act, the obligation to determine beneficial ownership also applies to dividends. This view was first challenged by the District Administrative Court in Łódź, and was referred to the Supreme Administrative Court.

In the Supreme Court’s view, with respect to dividends, the remitter is required, while exercising due diligence, to verify only those conditions expressly listed in the relevant provisions of the CIT Act. the Supreme Court noted that the legislator does not impose an obligation on the remitter to verify whether the company receiving the dividends is their beneficial owner.

The comments above are based on the Supreme Court’s oral justification. The written justification of the judgment is pending.

For more information, please refer to a report prepared by KPMG in Poland.

AI revolution in transfer pricing – September 25, 2025

On September 25, 2025, a panel of KPMG professionals will explore how AI is helping to reshape transfer pricing, demonstrate practical applications of AI-driven tools, and provide actionable guidance on leveraging automation and advanced analytics to enhance your transfer pricing processes.

Calling all transfer pricing enthusiasts - learn how you can unlock the untapped potential of AI in transfer pricing. Join for a session that delves into the future of transfer pricing with AI embedded into the transfer pricing lifecycle. KPMG professionals will discuss the burgeoning role and transformative impact of AI in the tax profession including the opportunities and challenges of relying on AI-generated results. KPMG specialists will share insights into pragmatic approaches for using and embedding AI into transfer pricing process and the interaction with existing automation solutions.

Please access the event page to register.

Managing tax reporting challenges for the digital economy – Last developments – September 3, 2025

On September 3, 2025, a panel of KPMG professionals explored last developments in the implementation of new tax reporting obligations impacting the digital economy sector.

On June 13, 2025, China implemented new tax reporting regulations for both resident and non-resident digital platform operators. These regulations require operators to provide the Chinese tax authorities (STA) with quarterly reports detailing the identity and income of the platform's users. The first reports are due by 31 October 2025. These new regulations align with global trends, including the DAC 7 requirements for digital platform reporting in the EU, and the OECD’s Model Rules for Reporting by Platform Operators.

Although there remains some uncertainty regarding how the Chinese tax authorities will utilize the collected data, it is clear that tax authorities worldwide are increasingly requesting more data from digital economy participants. In this session, KPMG Indirect Tax professionals will explore recent tax reporting developments globally and discuss potential strategies digital platform operators can adopt to navigate the evolving regulatory environment.

During this webinar, the following key topics has been addressed:

• The global trends in implementing tax reporting requirements as a means of enhancing tax transparency, including the new Chinese new tax reporting regulations for digital platform operators, and developments elsewhere in the world;
• What specific information must be reported under the new reporting requirements, with practical recommendations for foreign digital platforms;
• The similarities and differences between the major reporting requirements being implemented around the world, and the EU’s DAC 7 requirements and OECD’s Model rules;
• What steps digital platform operators can take now to prepare for these regulatory changes, along with potential strategies to manage the associated tax reporting challenges.

This session aimed to provide you with the necessary insights to navigate the evolving tax reporting landscape effectively.

The replay of the webcast is available on the event page.

Navigating global trade: Approaches and reactions in a changing tariff landscape – August 7, 2025

On September 3, 2025, a panel of KPMG Trade & Customs professionals explored the implications of these developments and addressed the concerns businesses may have in the new trade environment.

As trade policy changes continue to evolve, accelerate, pause and more, businesses worldwide have been experiencing disruption to supply chains and financial uncertainty over the past 6 months. Does this now mark the beginning of a new period of stability, enabling more longer-term planning, or merely a new stage in this evolution of global trade. Staying ahead of these changes is critical to safeguarding businesses’ competitive position and financial resilience.

This webinar equips businesses with updates, practical insights, actionable strategies and effective tools to help successfully navigate the complexities of today’s challenging landscape.

Topics include:

• Understanding the current tariff environment: Gain clarity on the international tariffs landscape, an overview of recent trade deals and reciprocal tariff rates.
• Market reactions and trends: Engage in discussions with our regional teams to explore how companies around the globe are adapting to evolving market dynamics.
• Tariff mitigation case studies: Learn from real-world case studies shared from experienced KPMG professionals including tracing origin, valuation strategies, etc.

Understanding and adapting to the impacts of these reciprocal tariff rates is not just about managing disruption but about identifying avenues for mitigation, resilience and growth.

The replay of the webcast is available on the event page.

Key links

• Visit our website for earlier editions.