Welcome to the Chartered Accountants Ireland BEPS centre

“Base Erosion and Profit Shifting (BEPS) refers to tax planning strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations where there is little or no economic activity, resulting in little or no overall corporate tax being paid. BEPS is of major significance for developing countries due to their heavy reliance on corporate income tax, particularly from multinational enterprises (MNEs)”.

OECD

Tax International

The OECD recently published a Policy Note which steps up efforts to resolve the international challenge of taxing the digital economy along with a renewed effort to resolve outstanding BEPS issues.  The Policy Note was published following a meeting of the OECD/G20 Inclusive Framework group on 23/24 January which brought together 264 delegates from 95 member jurisdictions and 12 observer organisations.  According to the OECD, countries and jurisdictions participating in the Inclusive Framework will step up efforts toward reaching a global solution to the growing debate over how to best tax multinational enterprises in a rapidly digitalising economy. The first pillar of the Policy Note focuses on how existing rules that divide up the right to tax the income of multinational enterprises among jurisdictions, including traditional transfer-pricing rules and the arm’s length principle, could be modified to take into account the changes that digitalisation has brought to the world economy. According to the OECD, this will require a re-examination of the so-called ‘nexus’ rules which determine the connection a business has with a given jurisdiction and the rules that govern how much profit should be allocated to the business conducted there.   The Policy Note identified a second pillar which aims to resolve remaining BEPS issues. In the Policy Note, the OECD restates its intension to deliver a solution on the taxation of the digital economy by 2020 The Inclusive Framework will issue a consultation document that describes the two pillars in more detail, and a public consultation will be held on 13 and 14 March 2019 in Paris as part of the meeting of the Task Force on the Digital Economy. According to the OECD, further details on the consultation process, including how stakeholders can provide input and most effectively participate, along with the consultation document, will be published in the coming weeks.

Feb 04, 2019
Tax International

The Faroe Islands and Greenland became the latest jurisdictions to join the Inclusive Framework on BEPS which now numbers 127 jurisdictions. 

Jan 21, 2019
Tax International

The Cook Islands is the latest jurisdiction to sign up to the Inclusive Framework on BEPS while Malta and Singapore deposited their instruments of ratification for the Multilateral BEPS Convention before Christmas. One hundred and twenty-five countries and jurisdictions are now part of the Inclusive Framework on BEPS with the latest addition of the Cook Islands.   Meanwhile, the Multilateral Instrument (MLI) will enter into force for Malta and Singapore in April this year.  The MLI is a mechanism for governments to transpose measures from the OECD/G20 BEPS Project into bilateral tax treaties worldwide. The MLI modifies the application of thousands of bilateral tax treaties concluded to eliminate double taxation. It also implements agreed minimum standards to counter treaty abuse and to improve dispute resolution mechanisms while providing flexibility to accommodate specific tax treaty policies.

Jan 07, 2019