Pillar 2: Switzerland defers OECD guidance on Article 9.1
Pillar 2: Switzerland defers OECD guidance on Article 9.1
In Switzerland, the OECD Administrative Guidance on Article 9.1 of the GloBE Model Rules dated 13 January 2025 is to be considered when calculating the Swiss and international top-up taxes only for fiscal years beginning on or after 1 January 2025. This is stipulated in the new Article 2 paragraph 3bis of the Minimum Taxation Ordinance.
At its meeting on 21 October 2026, the Federal Council amended the Ordinance on the Minimum Taxation of Large Enterprise Groups accordingly. In doing so, it implements two identically worded parliamentary motions calling for the guidance to apply one year later than the internationally specified application date. The amendment largely follows the proposal submitted for consultation. Further information: Federal Council amends Minimum Taxation Ordinance.
The Administrative Guidance on Article 9.1 of the GloBE Model Rules is intended to prevent certain deferred tax assets from being used to avoid top-up tax. To this end, it restricts the use of such deferred tax assets (DTAs) in connection with tax credits or agreed tax basis step-ups. We have previously reported on this topic: Update on OECD's Pillar Two: Global minimum tax in Switzerland - BDO.
Entry into Force and Implications for Fiscal Years Beginning in 2024 or Later
The amendment to the Ordinance enters into force on 15 November 2026. The Administrative Guidance on Article 9.1 of the GloBE Model Rules is now to be considered only for fiscal years beginning on or after 1 January 2025. However, the amendment also has retroactive implications for fiscal years beginning on or after 1 January 2024.
Companies whose first fiscal year under the GloBE Model Rules ended on 31 December 2024 were required to file their first top-up tax return by 30 June 2026. The retroactive effect may therefore affect tax returns already filed and, where applicable, tax assessments already issued.
Important for affected companies:
For the 2024 tax return, the Swiss Federal Tax Administration (FTA) had stated in its practice communication of 7 April 2026 that the original Ordinance and the Administrative Guidance dated 13 January 2025 were to be applied. However, as a result of the retroactive effect now adopted, this guidance will apply in Switzerland one year later than internationally specified.
Affected companies must therefore first review the basis on which they prepared their 2024 tax return. If they applied the Administrative Guidance in accordance with the FTA's communication at the time, two questions must be assessed: Does the tax return need to be corrected, and are there any implications for a tax assessment already issued?
In certain circumstances, the deferred tax expense arising from the full or partial reversal of the affected deferred tax assets may be included in the calculation of the effective tax rate (ETR) for 2024 for the purposes of ensuring the minimum tax rate of 15 per cent. This may avoid a top-up tax liability.
