Two weeks to 14 October 2022
Welcome to our latest update on recent developments in international and treasury tax of interest to multinationals operating in the UK.
UK
Fiscal event
The Chancellor of the Exchequer has commissioned the Office for Budget Responsibility’s (OBR’s) forecast for 31 October 2022, and will publish the Medium-Term Fiscal Plan on the same date.
- Jeremy Hunt’s statement on the Medium-Term Fiscal Plan - 17 October
The new Chancellor has made a statement revoking many of the measures proposed by Kwasi Kwartang in his mini-budget last month. This follows the Prime Minister's statement on Friday, and further conversations between the Prime Minister and the Chancellor over the weekend, to ensure sustainable public finances underpin economic growth. The Chancellor will deliver the full Medium-Term Fiscal Plan, alongside a forecast from the independent Office for Budget Responsibility, on 31 October. For a summary of where things now stand, see here, and for our senior economist’s response to the announcements, see here. - Chancellor announces substantial changes to previous tax announcements - Read more.
- Corporation tax to increase to 25% from 1 April 2023 - 14 October update
In a bid to restore market confidence, the Government has reversed its decision (on 23 September) to scrap the rise in the corporation tax rate. The CT rate will increase from 19% to 25% from 1 April 2023. - Reversal of tax changes affecting Real Estate
Many of the tax changes affecting Real Estate which were announced on Friday 23 September 2022 have since been reversed. Read more - Tax simplification after the OTS
The Chancellor of the Exchequer announced plans to shut The Office of Tax Simplification (OTS) in the UK Government’s ‘Mini-Budget’. We consider the evolution of tax legislation over the last few years, including the likes of the OECD Pillar 2 framework, and examine whether closing the OTS could deliver simplification. Read more.
Call for Evidence: Review of hybrid and distance working
The Office of Tax Simplification (OTS) has launched a consultation on the emerging trends and tax implications of hybrid and distance working, which will close on 28 October. This is planned to be a high-level evidential review of the current extent of hybrid and distance/home working, whether it is likely to increase, whether this trend involves more working across borders, and whether changes in working practices give rise to any tax complexity or challenges for employers and employees, as well as small businesses.
Treaty updates
- UK/Isle of Man
HMRC have published on their website, the exchange of letters between the UK and Isle of Man which brought into effect Article 27 Assistance in Collection of Taxes) of the Isle of Man/UK double tax treaty from 1 January 2022. - UK/India
A synthesised text of the India/UK double tax treaty and the MLI, which entered into force for the UK and India on 1 October 2018 and 1 October 2019 respectively, has been published on the HMRC website here. - Double Taxation Treaty Passport Scheme register
HMRC has updated the register of overseas corporate lenders who are passport holders for Double Taxation Relief on UK loan interest. The register has been updated with 98 additions and 16 amendments.
GAAR opinion: SDLT arrangements in relation to the sale and purchase of a residential property
This opinion covers Stamp Duty Land Tax arrangements in relation to the sale and purchase of a residential property, involving an alternative finance agreement and a lease agreement.
Director's duties in the insolvency arena
On 5 October, the Supreme Court delivered its verdict in Sequana, a case that provides guidance on how and when Directors of English companies should have regard to creditors' interests. See the full decision here.
HMRC Manual updates
- INTM422100 - Transfer pricing: methodologies: Advance Pricing Agreements: monitoring and review
The link to contact details was updated on 6 October, see here.
Approved offshore reporting funds
HMRC has updated the list of approved offshore reporting funds to include the latest funds that have entered the Reporting Fund Regime. The list has been updated to include the funds that have entered as at 3 October 2022. View the updated list.
Talking Tax - October 2022
This edition includes insights into three of the key talking points arising from the September 2022 'Mini-budget': 1) Investment Zones Vs Freeports - which offers greater opportunity to businesses? 2) Tax simplification after the OTS; 3) Repeal of the off-payroll worker regulations - greater efficiency or more risk?
The importance of sanctions in due diligence
In a world where deals have hit record levels in the UK and worldwide, how many organisations are actually considering the sanctions risks associated with mergers, acquisitions and joint venture arrangements? Read more in this blog.
EU
Anguilla, The Bahamas and Turks and Caicos Islands added to EU list of non-cooperative jurisdictions for tax purposes
On 4 October, the European Council added Anguilla, The Bahamas and Turks and Caicos Islands to the EU list of non-cooperative jurisdictions for tax purposes. Turks and Caicos Islands are listed for the first time, the Bahamas was already once listed in 2018, and Anguilla once in 2020. With these additions, the EU list now consists of 12 jurisdictions.
In addition, the Council also approved the usual state of play document (Annex II), which reflects the ongoing EU cooperation with its international partners and the commitments of these countries to reform their legislation to adhere to agreed tax good governance standards. Bermuda, Tunisia and Costa Rica have been removed from that document, whilst Armenia and Eswatini have been added.
For further detail, including reasons for the deletions and additions mentioned above, read more in this press release.
European Commission launches public consultation on BEFIT
Business in Europe: Framework for Income Taxation (BEFIT) will propose a comprehensive solution for business taxation in the EU. This initiative aims to introduce a common set of rules for EU companies to calculate their taxable base while ensuring a more effective allocation of profits between EU countries, based on a formula. It will also aim to reduce compliance costs and create a coherent approach to corporate taxation in the EU. The European Commission is seeking input until 5 January 2023.
The EU Energy Crisis Package moves a step closer to full ratification
EU energy ministers have agreed on a first package of emergency intervention measures to address skyrocketing energy prices. The ministers reached an agreement following a short discussion, keeping the core substance of the Commission proposals while adding few amendments which enable flexibility and practical implementation. Read more in this PwC news item.
- Tax accounting considerations - Solidarity Contribution Tax - PwC Netherlands item
MEPs call for using blockchain to fight tax evasion and an end to crypto asset non-taxation
MEPs have adopted a resolution calling for a better use of blockchain to fight tax evasion and for member states to coordinate more on the taxing of crypto assets. The non-binding resolution, sets out a framework through which both goals of using blockchain in taxation and uniformly taxing crypto assets can be achieved. Read more in this press release
CFE Tax Advisers Europe
- EU Tax Policy News Top 5
The latest round-up of EU Tax Policy news from the Confédération Fiscale Européenne (CFE). The latest edition from 10 October includes: 1) OECD Presents New Crypto-Assets Transparency Framework; 2) Inclusive Framework on BEPS Release Progress Report for Public Consultation; 3) Register Now: CFE Professional Affairs Conference 2022 “Targeting the “Bad Apples”: Enablers of Tax Avoidance – 2 December 2022; 4) Council of the EU Blacklists Anguilla, The Bahamas & Turks and Caicos Islands; and 5) Wyman Symposium 2022: Regulation of the Tax Profession – Is it the Way Forward? Visit their latest news page here. - Global Tax Top 10 - September 2022
The latest edition includes: 1) CFE President addresses EU Finance Ministers at informal ECOFIN meeting in Prague; 2) State of the Union: EU Commission plans to introduce windfall tax on energy companies; 3) Pascal Saint-Amans to step down as director of the OECD centre for tax policy and administration; 4) EU Pillar II implementation: certain member states to proceed unilaterally; 5) EU Commission to launch BEFIT consultation & proposal; 6) Rentree Refresher: EU Tax Policy Report: Semester I 2022; 7) OECD: Tax Morale II – Building Trust Between Tax Administrations & Large Businesses; 8) Czech Chamber of Tax Advisers & IFA Address Professional Ethics in Tax Advice; 9) Forum on Tax Administration publishes tax capacity building guide; and 10) OECD: Action 14 Tax Dispute Resolution Stage 2 Peer Reviews published.
OECD
Pillar 2
- Are Pillars 1 and 2 still relevant amid growing uncertainty?
In this Policy on Demand episode from 7 October, Will Morris, PwC’s Deputy Global Tax Policy Leader, briefs us on the status of Pillars 1 and 2 and shares his insights on potential developments around this important project over the next few months. - The OECD minimum tax: What US companies need to know
The OECD two-pillar framework will significantly alter many international tax practices we follow today with a related impact on reported earnings. This PwC In the loop provides the key considerations, including how certain financial statement concepts interact with framework, to begin to assess what the OECD’s proposal will mean to them. - Countries making substantial progress towards implementation of the two-pillar international tax reform
The OECD reports that, a year after the international community reached a landmark agreement on a two-pillar solution to reform the international tax rules to address the tax challenges arising from globalisation and digitalisation, strong progress continues towards its implementation. Read more in this OECD press release. - Tax Incentives and the Global Minimum Corporate Tax
Wherever tax incentives drive an MNE’s effective tax rate (ETR) in a jurisdiction below 15%, the MNE would potentially be subject to top-up taxes under the GloBE Rules, a core component of Pillar Two. Therefore, the design of tax incentives will require careful reconsideration in a post-Pillar Two environment. This report, published on 6 October, therefore considers the existing use of tax incentives in developed and developing countries, analyses key provisions of the GloBE Rules and shows how they may impact different types of tax incentives differently. The report concludes with policy considerations for countries.
Pillar One Model Rules
- OECD invites public input on the Progress Report on the Administration and Tax Certainty Aspects of Amount A of Pillar One
The Progress Report on the Administration and Tax Certainty Aspects of Amount A of Pillar One is a consultation document released by the OECD Secretariat for the purposes of obtaining further input from stakeholders on the administration and tax certainty aspects of Amount A. Comments are invited before Friday 11 November 2022. Read more in our PwC tax policy bulletin.
MLI
- Mexico ratifies MLI affecting 55 tax treaties
The Mexican Senate recently ratified the OECD Multilateral Instrument (MLI). As a result the instrument could be in force for Mexico as soon as 1 February 2023, if the instrument of ratification is deposited with the OECD before the end of October 2022. Mexican taxpayers, as well as multinationals doing business in Mexico, should assess the potential impact that the MLI provisions will have in their tax analysis for the application of a tax treaty between Mexico and other MLI signatories. Read more in this PwC Tax Insights. - Mongolia signs MLI
Mongolia has signed the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the MLI), at a signing ceremony held in Paris at the 14th meeting of the Inclusive Framework on BEPS. See here. Mongolia becomes the 100th jurisdiction to join the BEPS Convention, which now covers around 1850 bilateral tax treaties. - South Africa deposits MLI instrument of ratification
On 30 September 2022, South Africa deposited its instrument of ratification of the OECD’s Multilateral Instrument (“MLI”), meaning that 48 of its double tax treaties will be modified from 1 January 2023. Read more in this PwC Alert. - UK/India
A synthesised text of the India/UK double tax treaty and the MLI, which entered into force for the UK and India on 1 October 2018 and 1 October 2019 respectively, has been published on the HMRC website here.
See https://oe.cd/mli.
OECD issues new Crypto-Asset Reporting Framework
- The OECD on 10 October published a much-anticipated two-part document - the Crypto-Asset Reporting Framework (CARF) and Amendments to the Common Reporting Standard (CRS) - setting forth a global tax transparency compliance framework with model rules for the automatic reporting and exchange of taxpayer information between countries relating to financial accounts and crypto-assets. The CARF, which responds to a G20 request, will be presented to G20 Finance Ministers and Central Bank Governors at their October 12-13 meeting in Washington, DC. Read more in this PwC Tax Insights and OECD press release.
- PwC Webcast: OECD Final Crypto-Assets Reporting Framework
Register here to join our global webcast on Wednesday 19 October at 4pm, where PwC Digital Assets Tax Leaders will be joined by an OECD panellist to discuss the key changes in the final framework and share insights into the potential implications to intermediaries, tax authorities, and other stakeholders.
14th meeting of the OECD/G20 Inclusive Framework on BEPS
The 14th Meeting of the OECD/G20 Inclusive Framework on BEPS took place from 6 to 7 October 2022 at the OECD Conference Centre in Paris. Certain sessions of the plenary meeting were available for the public to watch online on the afternoon of Thursday 6 October, allowing a glimpse into the various international tax-related work streams undertaken by the over 135 member countries and jurisdictions of the Inclusive Framework. Watch here.
OECD Tax Report to G20 Finance Ministers and Central Bank Governors
This report sets out the latest developments in international tax reform, including on the Two-Pillar Solution and major developments in tax transparency efforts, together with a new roadmap on tax and development, and updates on other important work including the implementation of the BEPS minimum standards and on tackling tax and crime.
Heads of tax administrations emphasise the importance of swiftly implementing the landmark global tax agreement and enhancing collaborative work on digital transformation
Marking the 20th anniversary since its creation, the OECD's Forum on Tax Administration (FTA) held its annual Plenary meeting in Sydney, Australia, on 28-30 September 2022. Tax commissioners from across the globe, including representatives from international organisations, regional tax administration bodies and business, came together for their first in-person Plenary for three years. Read more in this OECD news item and communique.
OECD releases Vietnam’s second MAP peer review report
The OECD recently published “Making Dispute Resolution More Effective – MAP Peer Review Report, Vietnam (Stage 2)”. The Report details what actions Vietnam has taken and will take to improve its mutual agreement procedure so that it meets the requirements of Action 14 of the OECD’s Base Erosion and Profit Shifting initiative. This PwC NewsBrief summarises the findings of the Report and what this may entail for Vietnam’s tax treaties.
Other territories
International
Digital tax byte
The latest addition to our series of brief insights into the workings of the UK and supranational bodies reviewing the taxation of digitalisation of business. The latest edition, from 12 October, includes an update on various VAT issues to consider in the Gulf Cooperation Council states and the release by the OECD of a Crypto Asset Reporting Framework (and update to CRS for financial institutions).
Digital tax megabyte
This edition, to the end of September, includes clarification from Kenya on the exemption for registered non-resident suppliers of digital services from issuing electronic tax invoices and news from Australia that the new Government has reintroduced plans for digital platform reporting. The European Commission has also adopted an implementing Regulation on DAC7 schema and statistical reporting. Meanwhile Colombia proposes to introduce a significant economic presence tax rule. The OECD intends to broadcast part of the Inclusive Framework meeting on 6 October 2022 (to view live or recorded).
Environmental, Social and Governance (ESG)
- PwC’s annual review of corporate reporting in the FTSE 350 in 2021/22
A significant amount of additional content has been added to the annual report in relation to ESG matters, most recently with climate change reporting requirements under the Task Force on Climate-Related Financial Disclosures (‘TCFD’) framework. Read more. - Inflation Reduction Act: ESG provisions may provide benefits to the real estate industry
The Inflation Reduction Act's ESG-focused credit and Section 179D provisions may be of particular interest to the commercial real estate industry. Read more in this PwC Tax Insights. - Tax Readiness: ESG Tax Incentives in the Inflation Reduction Act
Watch the replay from 4 October, where our panel of specialists discuss the various tax and investment opportunities and how companies should consider these credits as a part of their broader ESG goals and strategy.
Visit our dedicated ESG webpage.
Australia
Australian Monthly Tax Update - October 2022
Welcome to the October 2022 edition of Australia's Monthly Tax Update, keeping you up to date on the latest Australian and international tax developments.
Australia seeks input on implementing BEPS 2.0 reforms
The Australian Treasury has launched a public consultation to seek views from interested parties on how Australia can best engage with the two-pillar solution, including the Pillar Two Model Rules and Commentary.
Australia/Iceland Tax Treaty
Australia and Iceland have signed a new tax treaty, which following its entry into force, will represent the first tax treaty between the two countries. Read more in this press release.
Austria
New VwGH case law on the PE definition in tax treaty law
A new decision of the Austrian Supreme Administrative Court (VwGH) was recently published regarding the definition of a “fixed place” under tax treaty law. For a fixed place to exist, a taxable person must have power of disposal over it. Read more in this PwC tax news item.
Belgium
See here for latest updates.
Belgian government agrees on federal budget: an overview of what you should know
After intense negotiations, the Belgian government reached an agreement on the Belgian federal budget. Addressing the ongoing energy crisis, limiting the budgetary deficit and stimulating employment are some of the key topics that have shaped the agreement. It also contains several important tax measures, including announcements on a temporary Belgian minimum tax and the abolition of the notional interest deduction regime for large companies. Read more in this PwC news item.
Filed your transfer pricing documentation in due time?
The Belgian Tax Administration (BTA) has started to send out the letters to eligible taxpayers for missing/late filing of transfer pricing documentation. Read more in this PwC tax news item.
Germany
Dividend income exemption also in case of double residence
According to a decision of the Supreme Tax Court, the dividend income exemption for trade tax on qualifying shareholdings is also available for distributions of companies of foreign legal form with its statutory (registered) seat abroad, provided the foreign company is comparable to a German corporation, has its place of management in Germany and therefore maintains a permanent establishment there. Read more in this PwC tax blog.
ECJ confirms German penalty charges for failure to submit sufficient cross border documentation
The European Court of Justice (ECJ) decided that the German penalty surcharge for failure to present proper documentation in cross border business relations is in line with the EU principle of freedom of establishment. Although there is a restriction because the documentation requirements and the associated penalty only apply to taxpayers engaged in business relationships with related parties abroad, the measures are proportionate, don’t go beyond what is necessary to attain the objective pursued and are necessary to ensure a balanced taxation powers between Member States. Read more in this PwC tax blog.
Transfer of economic ownership in case of licensing of film distribution rights
According to the Supreme Tax Court, the principles developed for leasing agreements regarding the attribution of economic ownership cannot be applied fully and without reservations to the transfer of the use of film rights. Read more in this PwC tax blog.
ECJ: Financing services provided through sub-participation exempt from VAT
According to the ECJ, financing provided to the originator under a sub-participation agreement is a VAT exempt transaction and complies with the exempt transactions listed Article 135(1)(b) of Council Directive 2006/112/EC (VAT Directive) concerning “the granting and the negotiation of credit and the management of credit by the person granting it”. Read more in this PwC tax blog.
Iceland
Australia/Iceland double tax treaty
Australia and Iceland have signed a new double tax treaty, which following its entry into force, will represent the first tax treaty between the two countries. Read more in this press release.
India
CBDT notifies new rule along with forms for recomputation of income without allowing the claim for deduction of surcharge or cess
The Finance Act 2022 had overturned various High Court decisions on the allowability of surcharge and/or education cess by making a retrospective amendment under section 40(a)(ii) of the Income-tax Act 1961 (the Act). To give effect to this amendment, the Central Board of Direct Taxes (CBDT) has inserted Rule 132 in the Income-tax Rules 1962, and prescribed Forms through a Notification to provide the procedure required to be followed by the taxpayers and Tax Officers to recompute income under sub-section (18) of section 155 of the Act. Read more in this PwC Tax Insights.
Israel
Israeli Parliament approves updated TP documentation requirements and CbC reporting obligations
The Israeli Parliament has formally introduced updated transfer pricing legislation and regulation requirements into law. The amended legislation includes two additional sections, 85B and 85C, which add the requirement for a Country-by-Country (CbC) report and set the legal foundation for a Master File requirement. In addition, the Finance Committee of the Israeli Parliament approved an update to the Israeli tax regulations (Israeli Regulations), which is a secondary legislation binding by law, that provides further guidance and detail to the Transfer Pricing Legislation and sets a Master File and Local File documentation requirement (collectively the updated Israeli TP Rules). Read more in this PwC Tax Insights.
Italy
Brief note on tax process reform
Law no. 130/2022 related to the tax process reform provides important developments about the burden of proof and witness evidence for proceedings started after 16 September 2022. Read more in this PwC blog.
Mexico
Mexico ratifies MLI affecting 55 tax treaties
As reported above, the Mexican Senate recently ratified the OECD Multilateral Instrument (MLI). As a result the instrument could be in force for Mexico as soon as 1 February 2023, if the instrument of ratification is deposited with the OECD before the end of October 2022. Mexican taxpayers, as well as multinationals doing business in Mexico, should assess the potential impact that the MLI provisions will have in their tax analysis for the application of a tax treaty between Mexico and other MLI signatories. Read more in this PwC Tax Insights.
Norway
Norwegian National Budget 2023
The Norwegian National Budget was presented on 6 October. This PwC tax blog provides an overview of the most important changes concerning Tax and VAT.
South Africa
South Africa deposits MLI instrument of ratification
As reported above, South Africa deposited its instrument of ratification of the OECD’s Multilateral Instrument (“MLI”) on 30 September 2022. This initially impacts 48 of its double tax treaties, which will be modified from 1 January 2023, since those 48 treaty partners have already ratified the MLI. Significant countries such as Mauritius, the Netherlands and the UK are included in this number. More of South Africa’s treaties will be modified as more countries ratify the MLI. Read more in this PwC tax alert.
Research and Development Tax Incentive Applications
The new Research and Development Tax Incentive Online System is now live and open for new applications. Read more in this brief PwC tax alert.
Tax Synopsis - October 2022
This edition covers: 1) What is the purpose of the definition of interest under section 24J? 2) Possible termination of the Kuwait – South Africa double tax treaty; 3) The Transfer Pricing and Customs Valuation Series: Article 2; 4) VAT treatment of irrecoverable debts; and 5) SARS watch.
Switzerland
For the latest updates on current topics, see this PwC Switzerland Insights page.
Federal Council wishes to increase transparency of legal entities
During its meeting on 12 October 2022, the Federal Council instructed the Federal Department of Finance (FDF) to draft a bill on increased transparency and easier identification of the beneficial owners of legal entities by the second quarter of 2023. In this way, it wishes to strengthen prevention and prosecution in the area of financial crime, and in turn the integrity and reputation of Switzerland as a financial centre and business location. Read more in this press release.
US
Inflation Reduction Act
The Inflation Reduction Act was signed into law by President Biden on 16 August.
- ESG provisions may provide benefits to the real estate industry
The Inflation Reduction Act's ESG-focused credit and Section 179D provisions may be of particular interest to the commercial real estate industry. Read more in this PwC Tax Insights.
IRS releases guidance on outbound transfers of intangible property
The IRS recently released an internal Advice Memorandum (AM 2022-003 or the ‘AM’), concluding that a transferee foreign corporation (‘FC’) may prepay annual Section 367(d) income inclusions (‘annual Section 367(d) inclusions’, colloquially referred to as ‘Section 367(d) deemed royalties’) when it transfers “money or other property” (‘boot’) in connection with a Section 351 transfer of intangible property subject to Section 367(d), but not in other situations. Therefore, the AM takes the position that FC may not prepay annual Section 367(d) inclusions after the initial transfer has occurred. Read more in this PwC Tax Insights.
IRS updates Uncertain Tax Position (UTP) reporting form and instructions
The IRS recently announced draft changes to Schedule UTP and Instructions for Schedule UTP for 2022 tax year returns to be filed and processed in 2023. Corporations must file Schedule UTP with their Form 1120, U.S. Corporation Income Tax Return, Form 1120-F, U.S. Income Tax Return of a Foreign Corporation, Form 1120-L, U.S. Life Insurance Company Income Tax Return, or Form 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return, if (1) their total assets equal or exceed the applicable asset threshold for the tax year ($10 million for 2022) and (2) they record a liability for unrecognized tax benefits for US federal income tax positions in their audited financial statements. Read more in this PwC Tax Insights.
The OECD minimum tax: What US companies need to know
The OECD two-pillar framework will significantly alter many international tax practices we follow today with a related impact on reported earnings. This PwC In the loop provides the key considerations, including how certain financial statement concepts interact with framework, to begin to assess what the OECD’s proposal will mean to them.
FinCEN issues final beneficial ownership reporting rule
Treasury’s Financial Crimes Enforcement Network (FinCEN) has issued a final rule implementing the Corporate Transparency Act’s (CTA’s) beneficial ownership information (BOI) reporting provisions. CTA, enacted in January 2021, targets tax fraud, terrorism, and money laundering by requiring US-formed corporations and limited liability companies (LLCs) and certain foreign-owned entities doing business in the United States to report to FinCEN certain information about their beneficial owners. The final BOI reporting rule is intended to enhance the ability of FinCEN and other agencies to provide information to government agencies, federal and state officials, and financial institutions to protect US national security and the US financial system from illicit and criminal activity while also aiding in the standardisation and transparency of information. Read more in this PwC Tax Insights.
California’s new tax basis reporting may present challenges for partnerships
In early 2022, when the California Franchise Tax Board (FTB) released 2021 tax forms and instructions for partnerships (Form 565) and limited liability companies (Form 568), taxpayers first learned that the FTB was requiring them to report tax basis capital amounts on a California basis rather than using the federal tax basis amounts. Partnerships have been challenged in recent years with new reporting requirements by the IRS, such as tax basis capital and Schedule K-2 and K-3 reporting; California’s tax basis reporting requirement adds to the burdens. California is the first state to require state-specific tax basis reporting for partnerships; however, other states may follow suit. Read more in this PwC Tax Insights.
Illinois extends calendar-year corporate taxpayer 2021 return due date until 15 November
The Illinois Department of Revenue recently released Bulletin FY 2023-02, Corporate Return Automatic Extension Due Date Change for the Tax Year Ending on 31 December 2021. The Bulletin provides that the extended due date for calendar-year 2021 Form IL-1120 returns is 15 November 2022. Read more in this PwC Tax Insights.
Pennsylvania court rules out-of-state sellers lacked due process nexus
The Pennsylvania Commonwealth Court recently held that out-of-state merchants on an online marketplace lacked due process nexus with Pennsylvania for both sales and use tax and personal income tax purposes. Further, the court ruled, the state could not compel the merchants to answer a detailed nexus questionnaire, and the merchants did not have to wait for a tax assessment before challenging the Department’s taxing authority. Read more in this PwC Tax Insights.
Policy on Demand series
- Are Pillars 1 and 2 still relevant amid growing uncertainty?
In this episode from 7 October, Will Morris, PwC’s Deputy Global Tax Policy Leader, briefs us on the status of Pillars 1 and 2 and shares his insights on potential developments around this important project over the next few months. - Week in Review
- In this episode from 14 October, Andrew Prior shares his insights on how critical comments are to Treasury’s efforts to draft regulatory guidance around the new 15% book minimum tax. He addresses the question he has received most, which is regarding the timing of that guidance. He encourages companies to stay engaged with Hill policy makers around potential year-end tax legislation.
- In this episode from 7 October, Todd Metcalf shares his insights on how we’re seeing a number of unusual trends that could affect the outcome of the midterm elections. He addresses the question he has received most, which is whether Congress will pass an end-of-the-year tax package to address urgent tax matters.
Cross-border tax talks
- Currency Exchange: Getting your Dollars worth
In this episode from 12 October, Doug McHoney (PwC Global International Tax Services Leader) welcomes Rebecca Lee (Washington National Tax Services International Tax Partner). Doug and Rebecca discuss the many tax aspects of a strong US dollar, including cream skimming, foreign exchange gains and losses with branches and CFCs, previously taxed earnings, translational versus transactional gain or loss, and more.
Tax Readiness webcast series
- Tax Readiness: Building a productive and resilient tax reporting strategy
Join our panel of specialists on Thursday 27 October at 7pm, as they discuss how practical, sustainable data and reporting solutions can help ease workforce pressures (e.g., widening labour gap, economic uncertainty, inflation, etc.) and compliance challenges moving forward. Register here. - Tax Readiness: ESG Tax Incentives in the Inflation Reduction Act
In this webcast held on 4 October, our panel of specialists discussed the various tax and investment opportunities and how companies should consider these credits as a part of their broader ESG goals and strategy. Watch here. - Tax Readiness: Q3 financial reporting considerations
Register here to watch the replay from this webcast held on 28 September, where our panel of Tax Accounting Services (TAS) specialists takes a deep dive into relevant tax accounting matters and recent tax developments. On this webcast, we discussed key financial reporting considerations for the IRA and CHIPS Act as well as the current economic environment.
Further information
You can sign up for Tax Alerts issued by the US to be emailed to you. Subscribe using the link on this page. A back catalogue of previous webcasts and other resources are available on our US tax reform hub here.
Vietnam
OECD releases Vietnam’s second MAP peer review report
As reported above, the OECD recently published “Making Dispute Resolution More Effective – MAP Peer Review Report, Vietnam (Stage 2)”. The Report details what actions Vietnam has taken and will take to improve its mutual agreement procedure so that it meets the requirements of Action 14 of the OECD’s Base Erosion and Profit Shifting initiative. This PwC NewsBrief summarises the findings of the Report and what this may entail for Vietnam’s double tax treaties.