Cross-border Tax Talks Pillar Two: UK realities
6 snips
Dec 3, 2025 In this insightful discussion, Matt Ryan, PwC UK’s International Tax and Treasury Network Leader, shares his expertise on the complexities of Pillar Two and UK tax policy. He discusses the evolving acceptance of net CFC tested income's coexistence with Pillar Two rules and outlines the timeline for UK legislative changes, potentially effective by 2026. Matt also highlights challenges like M&A data gaps and the lack of a global dispute mechanism. The conversation wraps up with updates on the UK corporate rate and the digital services tax.
AI Snips
Chapters
Transcript
Episode notes
Side‑By‑Side Agreement Likely But Limited Detail
- Governments aim to reach a side-by-side Pillar Two agreement by year-end but detail may be limited.
- The UK expects to legislate changes in early 2027 with possible retrospective effect to 1 Jan 2026.
Domestic Law Steps Delay Global Agreement Effects
- Even with an inclusive framework deal, countries must draft domestic legislation and run consultations before enactment.
- The UK plans to implement changes in 2027 and can apply them retrospectively if taxpayer‑friendly.
UTPR Safe Harbor Deadline Raises Accounting Risk
- The UTPR safe harbor for US‑parented groups ends for December‑year filers after 2025, raising immediate compliance concerns.
- Uncertainty persists about which jurisdictions will enact side‑by rules in time to avoid accounting impacts.