Singapore has quietly enacted one of the most significant shifts in its corporate tax landscape in decades. The Multinational Enterprise (Minimum Tax) Act 2024 (MMT Act) — Singapore’s implementation of the OECD’s Pillar Two Global Anti-Base Erosion (GloBE) rules — came into force for financial years starting on or after 1 January 2025. With IRAS opening registration in May 2026 and the first registration deadline falling on 30 June 2026 for groups with a 31 December 2025 financial year-end, in-scope MNE groups must act now.
This guide explains how Singapore’s Global Minimum Tax works, which businesses are affected, what the registration process entails, and how to prepare before the deadline.
What Is the Global Minimum Tax (Pillar 2)?
Pillar Two is an initiative of the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS 2.0). Its central objective is to ensure that large multinational enterprise (MNE) groups pay a minimum effective tax rate (ETR) of 15% on profits in every jurisdiction where they operate, regardless of local tax incentives or planning arrangements.
Singapore’s domestic implementation introduces two top-up tax mechanisms:
- Multinational Enterprise Top-up Tax (MTT) — also known as the Income Inclusion Rule (IIR). This applies to low-taxed profits of overseas group entities, collected at the level of the Singapore parent or intermediate holding company.
- Domestic Top-up Tax (DTT) — a qualifying domestic minimum top-up tax that applies to low-taxed profits of Singapore-based group entities. By enacting DTT, Singapore can collect the top-up tax itself, rather than ceding that revenue to a foreign parent jurisdiction.
Both taxes are administered by the Inland Revenue Authority of Singapore (IRAS).
Who Is Affected?
The MMT Act applies to MNE groups that meet both of the following conditions:
- Annual consolidated group revenues of at least €750 million in at least two of the four financial years immediately preceding the relevant financial year
- At least one group entity (parent, intermediate holding company, or subsidiary) is located in Singapore
The €750 million threshold is assessed at the group level — not at the Singapore entity level. A Singapore subsidiary of a large global group will be in scope even if the Singapore entity itself is relatively small.
Who Is Not Affected?
Businesses below the €750 million revenue threshold are entirely outside scope. Purely domestic Singapore companies with no foreign group entities are unaffected. Singapore’s standard corporate income tax rate of 17% is above the 15% GloBE minimum, so most Singapore-sourced profits will not generate a top-up tax liability — the DTT is primarily relevant where profits benefit from tax incentives or exemptions that bring the effective tax rate below 15%.
How the Effective Tax Rate Is Calculated
The ETR under GloBE is calculated on a jurisdictional basis — all group entities in a single jurisdiction are aggregated. The formula is straightforward:
ETR = Adjusted Covered Taxes ÷ GloBE Net Income
If the ETR in any jurisdiction falls below 15%, a top-up tax brings the group’s total tax in that jurisdiction up to the minimum. The top-up tax is typically collected by the ultimate parent entity’s jurisdiction via IIR, unless a qualifying domestic minimum top-up tax — such as Singapore’s DTT — has been enacted in the low-tax jurisdiction, in which case the local QDMTT takes priority.
Substance-Based Income Exclusion
The GloBE rules include the Substance-Based Income Exclusion (SBIE) — an important carve-out that excludes a portion of GloBE income based on the group’s payroll costs and tangible assets in that jurisdiction. The SBIE reduces the Pillar Two impact on groups with genuine economic substance in Singapore, reinforcing the value of real operational presence here.
Registration: What You Must Do Before 30 June 2026
IRAS commenced online registration for the MMT Act in May 2026. The registration deadline is within six months after the end of the group’s first financial year to which the MMT Act applies.
For groups operating on a calendar year (FYE 31 December 2025), the first in-scope financial year runs from 1 January to 31 December 2025, giving a registration deadline of 30 June 2026. Groups with non-December year-ends must calculate their own deadlines accordingly.
What the Registration Requires
Registration is completed via the IRAS e-Services portal. The form requires:
- Identity of the Ultimate Parent Entity (UPE) and its jurisdiction of tax residence
- Singapore entities within the MNE group and their roles (intermediate parent entity, constituent entity, etc.)
- Whether the group is subject to MTT, DTT, or both
- The group’s first in-scope financial year and financial year-end date
- The designated filing entity for Singapore purposes
Filing and Payment Obligations
Registration is only the first step. In-scope groups will also be required to:
- File a GloBE Information Return (GIR) — a standardised return setting out GloBE calculations for each jurisdiction
- File a Singapore Top-up Tax Return with IRAS
- Pay any MTT or DTT liability within the prescribed timelines
IRAS has published detailed guidance in its e-Tax Guide on the MMT Act. Transitional Safe Harbours — including the Transitional Country-by-Country Report (CbCR) Safe Harbour — may significantly reduce compliance burden for qualifying groups in the initial years.
Interaction with Singapore Tax Incentives
Singapore offers a range of corporate tax incentives under schemes such as the Global Trader Programme, Finance and Treasury Centre, and various family office tax incentives under Sections 13O and 13U. Many of these reduce the effective tax rate below 17%, and potentially below 15%. For in-scope MNE groups, such incentives may generate a DTT liability in Singapore.
This does not mean incentives lose their value — but the SBIE carve-out, Transitional Safe Harbours, and overall group ETR must be modelled holistically. In-scope groups should factor the Pillar Two impact into planning alongside Singapore’s transfer pricing documentation requirements and foreign-sourced income exemption rules under Section 13(8).
Practical Steps to Take Now
- Assess scope: Confirm whether your group’s consolidated revenues exceed €750 million in at least two of the past four financial years, and identify all Singapore constituent entities.
- Register with IRAS: Complete online registration before 30 June 2026 (December year-end groups), or within six months of your first in-scope FYE.
- Model ETR by jurisdiction: Work with tax advisers to calculate the jurisdictional ETR across all territories, identifying potential top-up tax exposures.
- Assess Transitional Safe Harbours: Determine whether the Transitional CbCR Safe Harbour or other provisions reduce complexity in the initial years.
- Review Singapore incentives: Model any Singapore tax incentives against DTT exposure and assess whether the SBIE carve-out adequately shelters Singapore income.
- Prepare for GIR filing: The GloBE Information Return requires substantial data on income, taxes, payroll and tangible assets per jurisdiction — begin data collection early.
Conclusion
Singapore’s Global Minimum Tax is no longer a distant regulatory concern — for in-scope MNE groups, the registration clock is already ticking. With IRAS opening the portal in May 2026 and the first deadline on 30 June 2026, prompt action is essential. Review our Singapore Company Compliance Calendar for a full picture of your annual filing obligations, and ensure your corporate governance and tax structures are aligned with this landmark change.
Raffles Corporate Services works with corporate groups to manage statutory and compliance obligations in Singapore. Speak with our team to understand how the MMT Act affects your Singapore entities.
— The Editorial Team, Raffles Corporate Services