Corporate Tax News

Issue 76 - November 2026

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BDO Global Office

As of November 2025, over 50 jurisdictions have enacted legislation aligned with the OECD’s Pillar Two global minimum tax framework. As countries refine their domestic rules, we spotlight targeted measures that enhance clarity and operational readiness:

  • Bahrain: A revised fee structure for tax appeals tied to the domestic minimum tax.
  • Hong Kong: Letters sent by the tax authorities to taxpayers reminding them of upcoming compliance obligations.
  • Kuwait: New Executive Regulations clarifying top-up tax procedures and improving stakeholder understanding.
  • Netherlands: Proposed amendments to align domestic law with OECD guidance.
  • Qatar: Continued development of a transparent tax system in line with global standards.
  • Spain: Approval of tax forms for filing entity notification, GIR submission and top-up tax self-assessment.

This issue also features analysis from the UAE on the consequences of a DMTT being recognised as “qualified” by the OECD and a review of the transitional CbCR safe harbour, exploring both its practical benefits and limitations. For a broader perspective, our quarterly Pillar Two update offers a global snapshot of legislative and regulatory progress, including reports on three countries (i.e., Cabo Verde, Iceland and Israel) preparing to introduce Pillar Two rules.

This issue opens with two seemingly unrelated—but strategically relevant—articles: Denmark’s shift to a near-full participation exemption for portfolio share dividends, paired with anti-abuse provisions; and the tax and nontax implications of foreign investment in coastal real estate in Mexico. Both articles underscore the importance of fully understanding the implications of investment decisions. 

Also from Denmark is a deep dive into the tax treatment of earnout payments in M&A transactions where ties to continued employment may trigger reclassification as salary—emphasising the importance of deal structuring and clear documentation.

We round up key budget measures with cross-border impacts:

  • Canada: The 2025 federal budget updates the transfer pricing rules and clarifies the treatment of investment income from foreign assets in the insurance sector.
  • Ireland’s Budget 2025 would simplify double tax relief under the participation exemption, expand coverage to jurisdictions with nonrefundable withholding taxes and overhaul the interest deductibility rules. 
  • Malaysia’s 2026 budget introduces new and extended tax incentives aimed at boosting investment. 
  • Mexico’s 2026 economic reform includes a capital repatriation incentive, benefits for entities involved in FIFA World Cup preparations and broader reforms affecting the tax treatment of nonresident digital platforms serving Mexican users.

Other noteworthy developments include a pivot by Brazil after tax rate changes relating to financial investments, betting and high-income individuals expired without conversion into law. Kenya’s repeal of its digital services tax and the introduction of a substantial economic presence rule has led to draft regulations outlining a comprehensive framework for taxing nonresident digital transactions. Malta has introduced a significant shift in tax policy, allowing certain entities and trusts to opt for a 15% final income tax in lieu of the imputation system.

As jurisdictions recalibrate their tax systems in response to global pressures and local priorities, strategic planning, clear documentation and proactive engagement remain essential. The newly released BDO Global Tax Outlook 2025 reinforces this message, offering insights to help businesses navigate complexity and prepare for what is next.

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