The IAS 12 modification proposals could be summarised as follows:-
Deferred tax exemption
Corporations would successfully be exempt from offering for deferred tax associated to top-up tax taxes arising from laws enacted to implement the OECD Pillar 2 mannequin guidelines (together with any qualifying home minimal high up tax). When the ultimate amendments are issued, the exception would apply instantly and till such time because the IASB decides both to take away it or to make it everlasting.
Nonetheless, an organization could also be required to reveal the next data in its annual monetary statements for durations starting after 1 January 2023:
- Whether or not it expects to be within the scope of the relevant GloBE mannequin guidelines;
- Details about the associated laws enacted (substantively enacted) to implement GloBE mannequin guidelines in jurisdictions during which the corporate operates;
- Whether or not it operates in jurisdictions the place: it moderately expects to be ‘low-tax’ primarily based on the precise GloBE mannequin guidelines or, as a substitute, its efficient tax charge for the present interval decided underneath IAS 12 is under 15 p.c;
- For all low-tax jurisdictions (in mixture), details about revenue earlier than tax, earnings tax expense and weighted-average efficient tax charge; and
- As soon as top-up tax is efficient for the reporter, current tax expense associated to top-up tax.
The IASB is predicted to hunt suggestions from stakeholders on the extent of disclosure required.
The give attention to BEPS Pillar 2 GloBE is predicted to extend additional as jurisdictions enact laws by means of 2023 and KPMG is working extensively with teams, together with influence evaluation, tax reporting, information and compliance, and transformation implications.
On these IAS 12 modification proposals, fast developments are anticipated. The IASB goals to publish an publicity draft with a 60-day remark interval in January 2023 and, topic to the feedback acquired, difficulty last amendments to IAS 12 throughout the second quarter of 2023.