The new obligations arising from the introduction of the Top-up Tax (Pillar 2) in Slovakia

We would like to inform you about the new obligations arising from the introduction of the Top-up Tax (Pillar 2) in Slovakia, which apply to multinational groups and large domestic groups with consolidated revenues exceeding EUR 750 million.

Please note that companies that are part of such the group are required to comply with this new tax obligation for the first time in Slovakia for the year 2024 by June 30, 2026.

For companies that are part of such groups, the following new obligations apply:

• GIR (GloBE Information Return):The group must submit a comprehensive global report in a standardized format, used to calculate the top-up tax in all jurisdictions of operation. Only one entity files this return for the entire group, typically the parent company.
• Notification of the Reporting Entity: Within 15 months (18 months for the first year) after the end of the fiscal year, you must notify the tax authorities which entity within the group is filing the main GIR. For the first period of 2024, the deadline is June 30, 2026.
• QDMTT return: The group is required to calculate its effective tax rate, taking into account the Safe Harbour rules. If these conditions are met, the calculation is significantly simplified. However, the company is still obliged to file a Slovak top-up tax return even if it meets the Safe Harbour criteria and the tax liability is zero. The filing deadline for the 2024 tax year is June 30, 2026.
• Permanent Establishments and Branches: These obligations also apply to Permanent Establishments of foreign taxpayers and Organizational Branches of foreign founders.
• Penalties for Non-compliance:Failure to file the notification or the top-up tax return within the set deadline may result in a penalty ranging from EUR 1,500 to EUR 50,000, which can be imposed repeatedly.

Should you require assistance with calculating the effective tax rate or setting up data collection processes from your subsidiaries, please do not hesitate to contact us