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Understanding the OECD’s Pillar Two framework in Switzerland
What is the OECD Pillar Two framework?
The OECD Pillar Two framework introduces a global minimum corporate tax rate of 15%, designed to combat tax base erosion and profit shifting. This major change impacts multinational enterprises (MNEs) operating across multiple jurisdictions, creating complex compliance challenges.
Understanding how this framework applies to your business is essential to minimising risks and maximising financial opportunities.
When do the new rules take effect in Switzerland?
The OECD's Pillar Two framework comes into effect in Switzerland in two phases:
- From 1 January 2024: The Qualified Domestic Minimum Top-up Tax (QDMTT) ensures Swiss entities reach the 15% minimum tax threshold.
- From 1 January 2025: The Income Inclusion Rule (IIR) applies to further ensure compliance with global minimum tax standards.
Multinational companies affected by these rules must register, declare, and comply using the Swiss Federal Tax Administration’s digital platform, OMTax, by June 2026 for the QDMTT. Failure to comply on time may result in penalties of up to CHF 10,000.
Read more about deadlines and requirements from the Swiss Tax Administration.
Who is impacted by Pillar Two in Switzerland?
The rules apply to multinational enterprise (MNE) groups with global consolidated revenues of at least EUR 750 million. Affected organisations include:
- Swiss-based multinationals: With their global operations headquartered in Switzerland.
- Subsidiaries of foreign MNEs: Operating or established within Swiss jurisdictions.
What actions should organisations take now?
If your business is affected, taking proactive steps now can mitigate risk and keep you ahead of the changes.
- Assess your organisation’s exposure to Pillar Two taxes.
- Review and enhance your financial reporting systems to meet new compliance requirements.
- Collaborate with experienced tax advisors to develop strategies for minimising your tax burden.
- Stay informed about ongoing regulatory updates in your jurisdiction.
Why choose RSM for Pillar Two compliance?
RSM combines global insights with local expertise to provide tailored support for navigating the complexities of the OECD’s Pillar Two framework.
- Proactive solutions to minimise financial risks.
- Expert guidance on new tax regulations.
- Customised strategies to align with your business objectives.
- Localised expertise combined with the global network of RSM professionals.
Get Pillar Two ready with RSM in Switzerland
Navigating the Pillar Two framework can feel overwhelming. RSM is here to simplify things for you. With expert guidance and tailored strategies, RSM helps middle market organisations in Switzerland adapt to these changes, ensuring compliance and optimising your tax outcomes.
Key contacts
RSM Switzerland stands ready to guide you through every step of Pillar Two implementation and compliance. Reach out to our experts today to ensure your organisation is future-ready.
