What is this new Pillar Two requirement?

Pillar Two (“P2”) is a global minimum tax initiative aimed at ensuring that multinational groups and large domestic groups (within the EU) pay a minimum effective tax of 15% on their taxable profits.

In this context, Belgium requires that in-scope groups that have a nexus in Belgium register with the Crossroads Bank of Enterprises (KBO/BCE) in order to obtain the required TIN for the group which they need in the context of further Pillar 2 compliance. It has been determined by Royal Decree of 5 May 2024 (published on 29 May 2024) that this requires the filing of a P2 Notification Form with the Belgian tax authorities. This form is very detailed however (see below for further information) and groups are therefore advised to immediately start gathering the relevant information considering the short filing deadline. 

Who needs to act?

The following taxpayers are in scope and must take action:

• Multinational groups and EU domestic groups.
• With a consolidated annual turnover in excess of 750 million euros for at least two of the four tax years preceding the tax year tested.
• That fall within the scope of the P2 rules at a Belgian level (i.e., with constituent entities established in Belgium, regardless of whether the ultimate parent entity (UPE) is tax resident in Belgium or elsewhere).

The following entities need to file a P2 Notification Form with the Belgian tax authorities:

• The Belgian UPE (i) if there is only one UPE established in Belgium; or (ii) if it was mandated in case there are several UPEs established in Belgium.
• A Belgian group entity (i) if there is no UPE and only one group entity is established in Belgium or (ii) if it was mandated in case there is no UPE in Belgium and multiple group entities are established in Belgium.

Note that a separate proxy form needs to be filled in to mandate the relevant parent or group entity. 

Key deadlines

The general rule is that the P2 Notification Form must be submitted online no later than 30 days after the start of the first year the P2 rules become applicable to the taxpayer. However, for taxpayers already subject to the P2 rules, this deadline is extended to 45 days after publication of the Royal Decree in the Belgian Official Gazette (Belgisch Staatsblad/Moniteur belge). Since the Royal Decree was published on 29 May 2024, the deadline hence lapses at midnight on 13 July 2024. 

What are your next steps?

Step 1: Make sure you have access to MyMinfin as you must file through the Myminfin portal.
Step 2: Gather the required information. The form requires detailed information about the structure of your group, including:

• Group Information (Part I): this section requires, inter alia, the Group's name (which should be unique and cannot correspond to the name of the UPE or any other entity according to the guidance), the reporting year’s start and end dates, the address of the UPE preparing the consolidated financial statements (CFS) and certain information about the Group’s reporting status. 
• Financial Statements (Part II): this section requires information on the type of CFS that is used, the applicable accounting standard, the currency used and a link to the publicly available CFS (if available).
• Ownership Structure (Part III): this section requires information on the relevant entities within the group (for example UPE, intermediary or partially owned parent entities, and details on certain subsidiaries). It also includes the corporate name, address, TIN, and specific role of the entity within the group structure (constituent entity, investment entity, etc.). 
• Contact Information (Part IV): details of the company filing the form, including tax ID, address, and information on the designated contact person (e.g., name, email, phone number).

Step 3: Complete and submit the P2 notification form electronically via the MyMinfin platform by 13 July 2024. The form must be filed in XML format. A XML conversion tool is available here. 

What happens after filing?

Upon successful registration with the KBO/BCE, the Belgian tax authorities will inform the group of its unique P2 TIN via e-mail. This P2 TIN will be used for future P2 prepayments, reporting, and compliance.

This requirement is therefore a prerequisite to making P2 top up tax prepayments and to submit subsequent P2 notifications and tax returns.

Our recommendations

Completing the form requires a thorough understanding of your group's P2 scope and the qualification of each entity.

• We recommend that you assess, collect and review the required information as soon as possible.
• You can consult the full guidance from the Belgian tax authorities (available in Dutch and French).

Contact us

Consult with your Baker McKenzie liaison to ensure proper compliance with Belgian P2 rules. Our Global Pillar 2 team has extensive experience in international tax matters and can provide tailored advice for your specific situation and can assist you in:

• Identifying Belgian constituent entities and determining whether they are covered by Belgian P2 legislation.
• Completing and submitting the notification form.
• Any other questions relating to P2.

We are here to help you navigate this new regulation and ensure your company remains compliant.