Cross-border Tax Talks Podcast | PILLAR TWO: HINDSIGHT IS 20/24 | Calum Dewar

[@TheShash270]

I initially thought if you pass any of the 3 safe harbors you should ideally should be relieved from the QDMTT as well in any shape or form, i am now trying to understand what is a QDMTT safe harbor isnt it the same? However, i am still not able to understand if lets say you pass the safe harbor but then the Q CBCR report is a US GAAP based Report (10K) then its not apples for apples because you would ideally have calculated a QDMTT based on local stat and not US GAAP?

[@DougMcHoney]

The “QDMTT safe harbor” typically refers to an IIR or UTPR jurisdiction that sets the top-up tax to zero if another country has a “qualifying” DMTT. Many of the QDMTT adopted by countries allow taxpayers to apply the “transitional safe harbors” to their QDMTTs. There are lots of apples, oranges and other fruits mixed with the bunch as a result of local stat vs. financial accounting standard of the UPE when computing the Pillar Two amounts. Keep in mind that the CbCR data for the transitional safe harbor can also be a “mixed bunch” but the CbCR report must be “qualifying” for taxpayers to rely on it.