Singapore has implemented its Base Erosion and Profit Shifting (“BEPS”) 2.0 Pillar Two minimum tax regime under the Multinational Enterprise (Minimum Tax) Act 2024 (“MMT Act”), effective for financial years beginning on or after 1 January 2025.
Under the MMT Act, two top-up taxes have been introduced:
- Multinational Enterprise Top-up Tax (MTT) (also known as the Income Inclusion Rule or IIR under the Global Anti-Base Erosion (GloBE) Model Rules), which applies to low-taxed profits of group entities located outside Singapore.
- Domestic Top-up Tax (DTT), which applies to low-taxed profits of group entities located in Singapore, allowing Singapore to collect any top-up tax arising domestically.
These measures are aligned with the Global Anti-Base Erosion (“GloBE”) Model Rules under BEPS 2.0 Pillar Two and are designed to ensure that large multinational enterprise (“MNE”) groups are subject to a minimum effective tax rate of 15% on a jurisdictional basis.
- Its consolidated annual revenue is €750 million or more in at least two of the four preceding financial years; and
- It has at least one Constituent Entity, joint venture, or reverse hybrid entity that is incorporated, registered, or located in Singapore.
In-scope MNE groups are generally required to register for MTT, DTT, and the filing of the GloBE Information Return (“GIR”) with the IRAS within six months from the end of the Ultimate Parent Entity’s (“UPE”) first in-scope financial year.
Registration covers:
- MTT (where applicable) and DTT; and
- Filing of the GIR.
The IRAS will process completed registrations within approximately one month of submission. The processing time may take longer if there is incomplete information. Following approval, notification letters will be issued to the relevant Singapore entities within the group.
Where the UPE is based overseas, it may appoint a Singapore Constituent Entity or a local tax agent to register on its behalf, supported by a letter of authorisation.
A surcharge of 10% on the DTT and MTT (if applicable) may be imposed where an in-scope MNE group fails to notify the IRAS of its registration liability under the MMT Act.
- Start early on data: The form requires non routine data (e.g., entity classifications and tax residency histories). Early entity classification and information collation will help to reduce downstream risk or delay processing risk, especially for in-scope calendar-year end MNE groups that must complete the registration by 30 June 2026.
- Governance over designations: Set clear roles and access for the designated GIR and DTT filing entity, including Corppass readiness and a defined contact person.
- Taking action now will simplify the registration process and position your organisation for a seamless start when the portal opens.