We would like to inform you that further supporting documents on the application of top-up taxes were published within the OECD in January 2025.

These are:

1. User Guide for Tax Administrations,
2. GloBE factsheet,
3. Administrative Guidance on the Central Record of Legislation with Transitional Qualified Status.

User Guide for Tax Administrations

This document should be used primarily by the tax administrations of each country to ensure that they are able to set up their systems correctly for the purposes of the top-up taxes.

GloBE factsheet

This guidance follows on from the July 2023 OECD guidance. The new version includes clarifications regarding the completion of the GloBE fact sheet and reflects administrative guidance issued in December 2023 and June 2024. The new version also includes a template that can be used to inform jurisdictions that they will receive a GloBE fact sheet through the exchange of information between countries.

Central Record of Legislation with Transitional Qualified Status

With regard to:

• the relatively rapid implementation of the Pillar 2 rules into national legislation,
• the complexity of the rules,
• the constant evolution of interpretations of the rules,

implementation in some countries may not be fully in line with the current OECD rules and interpretations.

In this case, for example the national top-up tax in the countries concerned could not be considered qualified (i.e. it could not be used for the safe harbour calculation), etc.

The countries concerned are therefore given a transitional opportunity to adjust the implementation of the Pillar 2 rules in their legislation to conform to any OECD interpretations. Until then – despite the fact that the legislation does not fully comply with the OECD rules – the implementation can be considered qualified (as it has been implemented at least to the minimum required extent).

Thus, the OECD has published a register of countries that have obtained transitional qualified status for the GloBE top-up tax (based on the profit inclusion rule) and for the national top-up tax.

Both the Czech Republic and Slovakia have obtained the qualified status.

So, if you calculate, for example, the Czech or Slovak national top-up tax for the year 2024, this tax will be treated as qualified for Pillar 2 purposes.

Amendment to the Act on Top-Up Taxes in the Czech Republic

Although the Czech Republic has implemented the Pillar 2 rules into its legislation with effect from 31 December 2023, this implementation does not fully correspond to the current OECD-based interpretations of Pillar 2. An amendment to this law is currently still in the Chamber of Deputies for its first reading, which is intended to bring Czech legislation more in line with current OECD interpretations.

Unfortunately, it is not at all clear at present, if the amendment will be adopted. However, it seems that the Czech tax administration will already interpret the current wording of the Act on balancing taxes in the light of the not yet approved amendment as much as possible.

We will keep you informed of further developments in this area.

In case you are interested in the field of top-up taxes (in the Czech Republic, Slovakia or abroad), please do not hesitate to contact us, if you have any questions.

We would also like to recommend the seminar on the topic of top-up taxes, which is presented from the perspective of the legal regulation by Mr. Michal Tuláček, a legislator of the Ministry of Finance of the Czech Republic and co-author of the text of the law and its amendments, and from the perspective of practice by my colleague Petr Němec, who specializes in this area.