Greetings and Happy Tuesday! This is Tax Roast, a weekly newsletter that brings you the latest updates and insights from the international tax world from tax experts (and coffee enthusiast) who are walking the tax advisory path.

And do not forget to check out our coffee of the week, because there is no tax news without a good cup of coffee :)

International Tax Update

Trinidad and Tobago/ One step closer to CbCR

On 21 March 2024, the government of Trinidad and Tobago published the act transposing the the BEPS Country-by-Country Reporting obligations into domestic law.

The legislation requires the ultimate parent of a multinational enterprise (MNE), or a constituent entity of the group, to submit a country-by-country (CbC) report to the Board of Inland Revenue, provided they are tax residents in the jurisdiction and satisfy predetermined criteria. It also classifies an "excluded MNE Group" as one whose total consolidated group revenue amounted to less than the equivalent of USD 850 million in the preceding fiscal year, according to consolidated financial statements.

Under the act reporting must occur within 12 months following the conclusion of the group's reporting fiscal year.

Netherlands / WHT returns filing goes online

As of 1 January 2024, taxpayers in the Netherlands have the option to file their dividend withholding tax returns electronically or submit a paper form. However, effective from 1 July 2024, filing the returns electronically will be mandatory. Accordingly, paper submissions for dividend withholding tax will no longer be accepted from that date as can be read HERE.

Panama / New list of participating jurisdictions under CRS

The Panamanian Tax Authority has published a list of 90 participating jurisdictions under the Common Reporting Standard (CRS) based on the OECD Automatic Exchange of Financial Account Information Agreement.

Saudi Arabia / New rules for collection of Zakat

The MoF of KSA has published the approval of the Executive Regulations for the Collection of Zakat, which clarifies all procedures related to the collection of Zakat and facilitates the collection procedures in all business sectors. The rules are effective for the fiscal year beginning on or after 1 January 2024. The regulation provides detailed guidance on collection mechanisms, calculation of the Zakat base and elements for additions and deductions from the Zakat base, calculation of adjusted net profit or adjusted net loss, special provisions for some taxpayers' activities - financing activities, real estate and construction activities, calculation of Zakat of discretionary taxpayers, rights and obligations of taxpayers, Zakat collection procedures, Zakat assessment and assumption.

Fun Tax Fact :)

Global minimum tax / Pillar 2 bootcamp

Following the computation of the top-up tax for a constituent entity, it becomes imperative to determine the allocation of this amount to specific jurisdictions and entities. There are three distinct taxes that can be utilized to impose the top-up tax on a constituent entity: the Qualified Domestic Minimum Tax Threshold (QDMTT), the tax based on the International Income Rule (IIR), and the tax based on the Universal Taxable Profit Rule (UTPR). Recognizing that the interplay between these three taxes may result in confusion regarding priority, the law establishes a clear and unambiguous framework to follow.

In the case of a constituent entity situated outside of the IIR jurisdiction, the top-up tax can be imposed by IIR jurisdiction through either the IIR or the UTPR. However, if IIR jurisdiction itself is considered a low-tax jurisdiction, an entity classified as a Low-Tax Constituent Entity (LTCE) located in IIR jurisdiction would initially be subject to the domestic top-up tax, which should typically be regarded as the QDMTT. The first rule to be applied would be the QDMTT, granting IIR jurisdiction the primary authority to tax an LTCE situated within its jurisdiction.

The second rule to be applied would be the IIR. Any IIR jurisdiction parent entity (such as a Ultimate Parent Entity (UPE), Immediate Parent Entity (IPE), or Partially Owned Parent Entity (POPE)) that possesses an ownership interest in an LTCE would apply the IIR to determine the top-up tax corresponding to its ownership interest in the qualifying income of the LTCE, unless the QDMTT safe harbor is applicable to the jurisdiction.

The final rule to be applied would be the UTPR, which would only come into effect to address any top-up tax that has not been accounted for by the IIR (and indirectly by the QDMTT). A comprehensive description of each of the three new taxes will be discussed in the following weeks.

Leadership principles for top managers at Big Multi Inc. 🏢

Rule #11 - Career goal setting

Scientists have not found the reason why employees are sooo hooked up on continuous progression in their career, but to keep them occupied, it’s a common practice to set certain targets and goals to them. In most cases key metrics are rather simple; ie., gross sales, more clients, better margins, etc. But you cannot tell them this, otherwise they would feel entitled to progress.

Hence, it’s better to give them seemingly unrelated, but contradictory goals. In this way when they get better result on goal A, they get worse outcome on goal B. In this way, you can always point at a metric if you want to justify the lack of career progression without compromising yourself.

Even better if you tell your team members to come up with their goals themselves. This can be very humorous to read what they think is actually contributing to the firm’s success… and of course it can save time and effort for you, so it’s a win-win situation - at least for you :)

Tax Roast of the week

Invite the crew for a coffee☕

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Coffee corner

The Oldest Coffee Place in Rome: Antico Caffè Greco

Nestled in the heart of Rome, the oldest coffee place in the city stands as a testament to the rich history and enduring love affair between Italians and their beloved caffeinated beverage. Established in 1760, this iconic establishment has witnessed the rise and fall of empires, the birth of artistic movements, and the evolution of coffee culture. Stepping into this historic café is like stepping back in time, as the original décor and ambiance have been meticulously preserved, transporting visitors to a bygone era.

As one sips on a perfectly brewed espresso, it's impossible not to marvel at the stories that have unfolded within these walls. The café quickly became a hub for intellectuals, artists, and politicians, who would gather to exchange ideas, debate, and find inspiration. It was here that some of Italy's greatest literary minds, such as Stendhal and Goethe, found solace and stimulation. Today, locals and tourists alike flock to this legendary coffee place, not only for its exceptional coffee but also for the chance to be a part of its storied past.

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