Ministry of Strategy and Finance has released draft amendments to the Enforcement Decree of the Act on International Tax Adjustment. The changes introduce the Qualified Domestic Minimum Top-Up Tax (QDMTT) for fiscal years starting 1 January 2026, covering calculation, allocation, and reporting rules.

Korea (Rep.)’s Ministry of Strategy and Finance has released Legislative Notice No. 2026-15 on 19 January 2026, initiating a public consultation and detailing draft amendments to the Enforcement Decree of the Act on International Tax Adjustment (Pillar 2 global minimum tax).

The amendments introduce the Qualified Domestic Minimum Top-Up Tax (QDMTT), approved in December 2025, which applies to reporting fiscal years beginning on or after 1 January 2026. The decree specifies how to calculate the QDMTT, allocate it among domestic constituent entities, and report and pay allocated amounts.

Reason for amendment

Following the revision of the Act on International Tax Adjustment to incorporate measures agreed upon within the OECD Inclusive Framework, including the introduction of a domestic top-up tax to secure taxing rights over low-tax constituent entities under the Global Minimum Tax regime, this amendment seeks to:

  • Specify the calculation of domestic top-up tax amounts,
  • Establish methods for allocation among constituent entities,
  • Provide rules for reporting and payment of allocated amounts, and
  • Extend the application period for transitional exemptions.

Key provisions include:

  • The scope of allocation of covered taxes recorded in the accounts of each constituent entity will be expanded to include not only other constituent entities but also joint ventures, their subsidiaries, and controlled foreign corporations classified as non-constituent entities.
  • For the calculation of adjusted covered taxes used in determining domestic top-up tax amounts, the provisions of the Global Minimum Tax will be applied. However, items of covered taxes allocated by foreign constituent entities to domestic constituent entities that are excluded from the calculation of adjusted covered taxes for domestic top-up tax purposes will be specified.
  • The statutory allocation of domestic top-up tax amounts for each fiscal year of a multinational enterprise group will be made in proportion to the Global Minimum Tax income of each domestic constituent entity. In cases where the group has no net Global Minimum Tax income but domestic top-up tax arises due to current-year adjustments, the allocation will be made in proportion to the Global Minimum Tax income of each domestic constituent entity from the preceding fiscal year that gave rise to the current-year domestic top-up tax.
  •  Transitional fiscal years will be defined as those commencing before 31 December 2027 and ending before 30 June 2029. Fiscal years in which the additional tax under the income inclusion adjustment rule is deemed zero will be defined as those commencing before 31 December 2025 and ending before 30 December 2026.

The Ministry also indicated that the recently agreed BEPS Inclusive Framework side-by-side arrangements will be reviewed and reflected in future tax law amendments.

Consultation

Stakeholders may submit opinions on the amendment by 5 February 2026, either online via the Citizens’ Participation Legislation Center or by written submission to the Ministry of Strategy and Finance. Submissions should state support or opposition with reasons, include the submitter’s identification and contact details, and may be sent by mail, email, or fax to the New International Taxation Standards Division.