International Tax update

·         In 2023 at Portugal, companies must print ATCUD and QR codes on all their invoices. They will need valid codes from the government and tax authority-certified software before they can start generating the invoices.

·         From July 2024 to January 2026, France will implement mandatory B2B e-invoicing, as well as an e-reporting obligation. This mandate impacts all companies operating in France.

·         The Australian Treasury has now made the Notifiable Instrument (Treasury Laws (Announcement of Australia-India Economic Cooperation and Trade Agreement Entry into Force) Instrument 2022) required for the Australia-India Economic Cooperation and Trade Agreement (AI-ECTA) to enter into force (Treasury Laws Amendment (Australia-India Economic Cooperation and Trade Agreement Implementation) Act 2022). The AI-ECTA applies to income years starting on or after the specified commencement date of 29 December 2022. 

·         Singapore to adopt Global Minimum Tax Rate of 15% w.e.f 1.4.2025, as per Indian Revenue Authorities. The present corporate tax rate in Singapore is 17% so it will have no real impact in Singapore.      

·         Hong Kong plans to apply the global minimum tax and the domestic minimum top-up tax starting from 2025 onwards

·         UK tax update - The Office of Tax Simplification (OTS) published a report on tax implications of hybrid and remote working. The OTS gives independent advice to the UK government on simplifying the tax system, to make things easier for taxpayers. This instant report focuses on the trend of allowing employees to work temporarily or permanently overseas while still being employed by UK businesses. Businesses mainly expressed concerns about the potential tax implications, such as the creation of a PE. They suggested providing relief or a "safe list" of jurisdictions that may help with short-term stays and asked for clarification on the definition of a home office PE. Businesses also suggested safe-harbor guidance to streamline the compliance implications of transfer pricing.

Also Plastic packaging tax has been introduced at UK from April 1, 2022

·         New Zealand top court held that interest on related party debt liable to be disallowed under GAAR even if funding arrangement complies with Thin Cap &Transfer Pricing . Revenue justified in invoking GAAR to disallow deduction to interest payments on convertible note where the interest payments were in substance repayments of principal, even though the funding arrangement fell within the ambit of interest deductibility provisions and also complied with applicable Special Anti-Avoidance Rules (SAARs) of Thin Capitalisation Rules(debt equity ratio limit) and Transfer Pricing (arm's length interest rate).

·         Brazil's proposed changes to transfer pricing and royalty deduction rules, with particular focus on the implications for US MNEs

·         The Denmark tax authority issued a tax ruling anaylsing whether Norwegian company have a PE in Denmark by virtue of a CEO who works from home in Denmark for 3 days a week and 2 days a week from office in Norway. It is held that Norway company have a PE in Denmark since CEO plays an important business role and the business interest is present in Denmark due to CEO’s location