An MNE Group must submit a qualified CbCR based on Qualified FS in order to be eligible for the Transitional Safe Harbor for CbCR (“TCSH”).
Based on the election of the DCE, the Tax (Top-Up Tax) Due shall be zero for any Tax Period starting on or before 31 December 2026, provided that no part of the Tax Period ends after 30 June 2028, in any of the following cases:
If the following two conditions are met:
If the Simplified ETR of the MNE Group in the State is at least 16% for Tax Periods starting in 2025, and at least 17% for Tax Periods starting in 2026, based on qualified CbCR.
If the group's total net pre-tax income is equal to or less than the SBIE amount, as per Article 10 of the DMTT Law, for CE resident in the State and in accordance with qualified CbCR rules.
The totals are computed based on the Qualified Country-by-Country Report for the tested Tax Period.
The Simplified ETR is calculated by dividing the Simplified Covered Taxes by the total pre-tax income, based on the MNE’s qualified CbCR.
If the MNE Group does not elect to apply Article 15 of the DMTT Law for the Tax Period in which it becomes subject to the DMTT Law during the transitional period, it cannot apply the Article in a subsequent Tax Period.
If the MNE Group is not obligated to submit a CbCR, this Article may still apply, provided that the Taxpayer includes in its Tax Return data derived from Qualified Financial Data that would have been included in such reports.
Transitional Period covers all Tax Periods beginning on or before 31 December 2026, excluding any period ending after 30 June 2028.
Qualified CbCR are reports prepared and filed using Qualified FS.
Qualified FS means: