In line with the agreement on a two-Pillar solution to reform the international tax system, the Government published its response to the consultation on how the Pillar 2 rules will be implemented in the UK. Alongside this, the Government also published draft legislation that sets out how the UK intends to translate the OECD’s Pillar 2 rules into UK domestic law. The draft legislation can be accessed at https://www.gov.uk/government/publications/introduction-of-the-new-multinational-top-up-tax.

CTG’s response to the consultation can be read here.

The response called for further direct consultation between HM Treasury and the charity sector on the impact of its implementation for not-for-profit organisations in the UK.

This will be very important to avoid unintended consequences as we have identified a potential issue for charities with UK trading subsidiaries which donate their taxable profits to the charity under the company Gift Aid Scheme.

CTG previously responded to the OECD consultation on Pillar 2 which can be read here.