Multinational top-up tax

STOP PRESS relating to new MTT and DTT legislation: Section 19 of, and Schedule 4 to, the Finance Act 2025 (FA 2025) contains legislation amending the current MTT and DTT rules and implementing the Undertaxed Profits Rule (UTPR). Most of the changes to the existing MTT and DTT rules take effect for accounting periods beginning on or after 31 December 2024 but some provisions have retroactive effect for accounting periods beginning on or after 31 December 2023. For certain other provisions, taxpayers can elect as to whether a change takes effect for accounting periods on or after 31 December 2023 or for accounting periods beginning on or after 2024. The UTPR has effect for accounting periods beginning on or after 31 December 2024. The transitional country-by-country reporting safe harbour anti-arbitrage rule, prevents groups that have entered into certain hybrid arbitrage arrangements from qualifying for the safe harbour, has effect from 14 March 2024. HMRC released a policy paper at Autumn Budget 2024 explaining the changes. For more information, see News Analyses: Legislation Day: Draft Finance Bill 2025—Tax analysis—Multinational