Switzerland has clarified the application of Pillar Two Side-by-Side Package safe harbour rules and Article 9.1 administrative guidance, including timing, DTA treatment, implications for top-up tax filings under the OMinT.
The Swiss Federal Tax Administration (FTA) on 7 April 2026 released official statements clarifying how Switzerland will apply the Pillar Two Side-by-Side Package and related administrative guidance on Article 9.1 of the Global Anti-Base Erosion Model Rules (GloBE Rules).
The statements address both the timing of safe harbour rules and the treatment of deferred tax assets (DTAs) linked to certain tax benefits, elections, choices or newly introduced corporate income tax after 30 November 2021.
The guidance confirms that safe harbour provisions included in the Side-by-Side Package, adopted by the OECD/G20 Inclusive Framework, are applicable in Switzerland under the existing Minimum Taxation Ordinance (OMinT). It also clarifies when these rules take effect and how they interact with domestic provisions governing top-up tax calculations.
In parallel, the FTA set out how administrative guidance on Article 9.1 of the GloBE Rules applies in Switzerland, particularly in relation to DTAs. This includes the treatment of deferred tax expenses in effective tax rate (ETR) calculations and the use of transitional relief mechanisms such as the Grace Period and its limitations. The statements also address the practical implications for filing top-up tax returns pending any amendment to the OMinT following parliamentary motions.
Communication-031-E-2026-e of 07.04.2026 – Top-up tax: temporal application and exercise of elections of the administrative guidance of 5 January 2026 on the Side-by-Side Package
Top-up tax: temporal application and exercise of elections of the administrative guidance of 5 January 2026 on the Side-by-Side Package
On 5 January 2026, the Inclusive Framework on BEPS of the OECD and the G20 (Inclusive Framework) adopted the administrative guidance that includes the Side-by-Side Package. The Side-by-Side Package includes five safe harbour rules.
Article 2 paragraph 3 of the Ordinance of 22 December 2023 on the Minimum Taxation of Large Corporate Groups (Minimum Taxation Ordinance, OMinT; SR 642.161) provides that the Global Anti-Base Erosion Model Rules of the Inclusive Framework (Global Anti-Base Erosion Model Rules, GloBE Rules) are to be interpreted, in particular, in accordance with the associated commentaries and related regulations of the Inclusive Framework. The safe harbour rules are part of the consolidated commentary and the GloBE Rules (see Art. 8.2 of the GloBE Rules). The safe harbor rules adopted to date by the Inclusive Framework are therefore applicable in Switzerland pursuant to Article 2 paragraph 3 of the OMinT.
The following safe harbour rules of the Side-by-Side Package are directly applicable as of the following dates:
- Extension of the transitional CbCR Safe Harbour: Provided that the relevant conditions are met (in particular regarding the “once out, always out” principle), this safe harbour rule may now also be applied to fiscal years beginning no later than 31 December 2027 and ending no later than 30 June 2029.
- Substance-based tax incentive Safe Harbour: Provided that the relevant conditions are met, this safe harbour rule may be applied to fiscal years beginning on or after 1 January 2026.
- Side-by-Side Safe Harbour: Provided that the relevant conditions are met, this safe harbour rule may be applied at the earliest to fiscal years beginning on or after 1 January 2026. In this context, the date specified in the so-called Central Record is relevant.
- UPE Safe Harbour: Provided that the relevant conditions are met, this safe harbour rule may be applied to fiscal years beginning on or after 1 January 2026.
- Simplified ETR Safe Harbour: Provided that the relevant conditions are met, this safe harbour rule may be applied to fiscal years beginning on or after 31 December 2025. Article 9 paragraphs 2 and 3 of the OMinT also apply to the calculations under the Simplified ETR Safe Harbour.
Top-up Tax: application of the administrative guidance on Article 9.1 of the Global Anti-Base Erosion Model Rules adopted on 13 January 2025
The Global Anti-Base Erosion Model Rules of the Inclusive Framework on BEPS of the OECD and the G20 (Global Anti-Base Erosion Model Rules, GloBE Rules) apply directly to international top-up tax and by analogy to Swiss top-up tax in accordance with Article 2 paragraph 1 of the Ordinance of 22 December 2023 on the Minimum Taxation of Large Corporate Groups (Minimum Taxation Ordinance, OMinT; SR 642.161). In particular, the GloBE Rules are to be interpreted in accordance with the associated commentaries and related regulations of the Inclusive Framework on BEPS of the OECD and the G20 (see Art. 2 para. 3 of the OMinT).
The administrative guidance on Article 9.1 of the GloBE Rules adopted on 13 January 2025 by the Inclusive Framework on BEPS of the OECD and the G20 (hereinafter referred to as “the administrative guidance”) is part of the consolidated commentary. The administrative guidance governs how the transitional rules of Article 9.1 of the GloBE Rules are to be applied in relation to deferred tax assets (DTAs) arising from certain tax benefits, elections, choices or a newly introduced corporate income tax after 30 November 2021. It further stipulates that the deferred tax expense arising from the reversal of such DTAs shall be excluded from the calculation of the effective tax rate (ETR). However, a time-limited (Grace Period) and amount-limited (Grace Period Limitation) exception is permitted. The list of cases which the administrative guidance describes in paragraph 8.5 of the consolidated commentary to Article 9.1.2 of the GloBE Rules is not exhaustive.
The Federal Chambers adopted two motions of identical wording on 15 December (National Council, motion 25.4392) and 18 December 2025 (Council of States, motion 25.4399), respectively, thereby instructing the Federal Council to amend the OMinT in such a way that the provisions of the administrative guidance apply in Switzerland only to tax benefits granted as from 1 January 2025.
The amendment to the OMinT requested by Parliament can, in most cases, not be implemented before the expiry of the filing deadline of the top-up tax returns. It is therefore necessary to establish how the declaration for top-up tax returns whose filing deadline expires before the completion of the process to implement the adopted motions is to be made.
Pursuant to applicable law and until the Federal Council decides on a possible amendment to the OMinT, the administrative guidance must be applied. Constituent entities subject to top-up tax must complete the relevant top-up tax returns in accordance with the administrative guidance and the Grace Period Limitation set out therein, and file them within the deadline set by the OMinT. An extension of the filing deadline is not possible under applicable law. It is essential that the constituent entity subject to top-up tax indicates, in the remarks on the relevant tax return, that its effective tax rate has been reduced as a result of the cap imposed by the Grace Period Limitation. The cantonal tax authorities will not issue final tax assessments for the cases concerned until the Federal Council has made its decision.
Earlier, Switzerland’s Federal Council launched a public consultation on amendments to the Minimum Taxation Ordinance (MTO), introducing new reporting requirements for multinational companies under the OECD’s Pillar Two rules on 30 April 2025.
