TaxGuided
All glossary terms

Glossary term

Income Inclusion Rule (IIR)

Pillar Two top-down rule charging top-up tax at the ultimate parent on low-taxed profits of subsidiaries.

Related terms

4

Jurisdictions

global

Definition

The IIR charges the ultimate parent (or an intermediate parent under a top-down approach) of an MNE group with the top-up tax on low-taxed constituent entities in the group. The IIR is the primary mechanism for the 15 percent minimum.

Examples

  • A multinational headquartered in a country adopting IIR pays top-up tax on its low-taxed subsidiaries.

Related terms

Pillar Two (Global Minimum Tax)GloBE RulesUndertaxed Profits Rule (UTPR)Qualified Domestic Minimum Top-up Tax (QDMTT)

Translations

ESRegla de Inclusión de Ingresos
ZH收入纳入规则
DEIncome Inclusion Rule
FRIncome Inclusion Rule
JA所得合算ルール

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This library is for general tax education only. Always verify filing obligations, due dates, and tax consequences against the cited primary source or with a qualified tax professional.