Global Updates – April 2025

Australia: Australian government announced the latest maximum superannuation guarantee contributions base and rate for the income year 2025-26 effective from July 1, 2025.

The ‘Australian Taxation Office’ (“ATO”) has announced the latest maximum superannuation guarantee contributions base and rate for the income year 2025-26.

Particulars	For the Year 2025 (July 1, 2025, to June 30, 2026)	For the Year 2024 (July 1, 2024, to June 30, 2025)
Maximum Superannuation Contribution base (per quarter)	AUD 62,500	AUD 65,070
Superannuation Contribution rate (in % per annum)	12%	11.5%

The “Superannuation guarantee contribution or Super” is the mandatory social security contribution by the employer, calculated on salaries (as defined) of the employees up to a certain limit, which is the maximum super contribution base. If the employee earns exceeding the limit for each quarter, then the employer is not required to make contributions for part of earnings exceeding the limit. The maximum superannuation contribution base is indexed each year in line with average weekly regular wages.

Implication:
Employers will need to update their payroll and accounting software systems considering the revised contribution base and rate.

Australia: Federal Budget 2025-2026

The Treasurer, Dr Jim Chalmers MP, presented theFederal Budget for 2025-26 on March 25, 2025. The key focus areas of this Budget are around easing cost of living pressures, providing affordable housing, and healthcare. The financial year followed in Australia runs from July to June.

Key changes are as follows-

Personal income tax measures:
As a part of cost-of-living relief measures, the budget has reduced personal income tax rate for one income slab/ threshold for the years 2026-27 and 2027-28 as announced and legislated earlier. The current tax slabs are unchanged. The revised rates are as below:

Income (in AUD)	2025-26 Tax Rates (July 1, 2025, to June 30, 2026)	2026-27 Tax Rates(July 1, 2026, to June 30, 2027)	2027-28 Tax Rates (July 1, 2027, to June 30, 2028)
From 0 to 18,200	Nil	Nil	Nil
From 18,201 to 45,000	16%	15%	14%
From 45,001 to 1,35,000	30%	30%	30%
From 1,35,001 to 1,90,000	37%	37%	37%
1,90,001 and above	45%	45%	45%

The Government has also introduced changes to the Medicare levy low-income thresholds retrospectively from July 1, 2024. In Australia, a Medicare levy of 2% applies to all taxpayers having annual taxable income exceeding specified thresholds for funding the National Health Scheme.

Effective from July 1, 2024, the Medicare levy new thresholds for singles, families, seniors, and pensioners are as below:

Category	2024-2025 Annual taxable income (in AUD)	2023-2024 Annual taxable income (in AUD)
Singles	27,222	26,000
Family income (See note)	45,907	43,846
Family income (See note)	43,020	41,089
Family seniors and pensioners	59,886	57,198

Note – For each dependent child, the family income threshold is increased further from AUD 4,027 to AUD 4,216.

In the Budget for 2024-25, the Government announced certain amendments to the foreign resident capital gains tax (“CGT”) regime to ensure that foreign residents pay their fair share of tax in Australia which were to apply to capital gain tax events occurring on or after July 1, 2025. The Budget 2025-26 has deferred the commencement of these amendments to the later of October 1, 2025, or the first quarter following the Separate Act receiving Royal Assent. The amendments include the following:

-Clarifying and broadening the types of assets subject to capital gain tax for foreign residents;

-The Principal Asset Test (“PAT”) will be changed to a 365-day testing period instead of point-in-time assessment. Hence, for determining whether more than 50% of an entity’s market value is derived from Australian real property, position at any time during the 365 days, preceding the disposal will be considered instead of at the time of disposal; and

-Foreign residents disposing off shares and other equity valued at over AUD 20 million will be required to notify the Australian Taxation Office (“ATO”) before executing the transaction.

Corporates

As a part of the Budget, the Australian Government announced plans to ban non-compete clauses for certain workers, prohibition on wage-fixing and no-poach agreements, effective from 2027. The non-compete provisions will be banned for workers earning less than the high-income threshold prescribed under the Fair Work Act (which is currently AUD 175,000 per annum and adjusted annually from July 1, each year). The non-compete clauses are certain terms in the contract that restrict employees from working for a competitor or starting a similar business during defined period post-employment. Further, currently, businesses are allowed to fix wages by making anti-competitive arrangements restricting workers’ pay and conditions, without the knowledge and agreement of affected workers and can also make ‘no-poach’ agreements that block workers from being hired by competitors. The Government will consult on the changes before introducing the new provisions, which will operate prospectively. The Government has also indicated possible changes to non‑solicitation clauses for clients and co‑workers, and non‑compete clauses for even high‑income workers.

Implications:

Employers should take note of the updated income tax slabs while processing the payroll.
Employers need to take note of the revised Medicare levy thresholds.
Employers should review and revise employment contracts and inter-company agreements to ensure compliance with upcoming bans on non-compete, wage-fixing, and no-poach clauses.

Bulgaria

Bulgaria: State Budget 2025 – Highlights

Bulgaria approved the 2025 State Budget which was published in State Gazette No. 25 and 26, on March 27, 2025, with measures taking effect from April 1, 2025, unless stated otherwise.

The following are the key highlights of the Budget 2025:

Increase in the minimum and maximum insurance bases from BGN 933 to BGN 1,077 and BGN 3,750 to BGN 4,130, respectively.
Reduction in the VAT registration threshold from BGN 166,000 to BGN 100,000
The businesses to adopt Standard Audit File for Tax (“SAF-T”) file with effect from January 1, 2026, an international measure for electronic exchange of accounting information between businesses and tax authorities which is introduced by OECD. It is elaborated separately below.
Various amendments to the global minimum tax (“GMT”) provisions including the provisions on safe harbor, tax carry forwards, transferable tax credits, etc.

The following are key provisions of Standard audit file for tax (“SAF-T”) reporting requirement:

Information covered:
SAF-T reports will include comprehensive business and accounting data such as taxpayer and ultimate owner identification, chart of accounts with accounting entries, purchase and sales invoices including for transactions with related parties, all incoming and outgoing payments, asset, and inventory transactions, as well as business nomenclatures and tax codes.
Frequency of submission:
Further, there would be three frequencies of submission, monthly, annually and upon request as under:
– by 14th of following month: general ledger, accounts payable and receivable, sales, and purchase invoices;
– by June 30 of the following year: details of fixed assets; and
– as an when requested: information of the inventories.
A six-month grace period will be allowed for the first submission.
Applicability:
SAF-T will be applicable in a phased manner. Large enterprises having annual net turnover more than BGN 300 million (EUR 153 million) or annual net tax more than BGN 3.5 million (EUR 1.8 million) would be subjected to this requirement from 2026 while it would be applicable to all small, medium, and large enterprises from 2029. Further, it will apply to all other enterprises from 2030.

Implication:
Businesses should start preparing their systems for new SAF-T requirement. Employers should take note of changes in social security minimum and maximum ceilings. Reduction in VAT threshold would have an impact for smaller businesses.

Canada

Canada: Minimum wages in British Columbia increased to CAD 17.85 per hour from CAD 17.40 per hour, effective from June 1, 2025.

Effective from June 1, 2025, British Columbia has increased the minimum wage to CAD 17.85 per hour from CAD 17.40 per hour.

Canada: Minimum wage in Ontario increased to CAD 17.60 per hour from CAD 17.20 per hour effective from October 1, 2025.

Effective from October 1, 2025, Ontario will increase the minimum wage to CAD 17.60 per hour from CAD 17.20 per hour.

Canada: Minimum wage in Quebec increased to CAD 16.10 per hour from CAD 15.75 per hour effective from May 1, 2025.

Effective from May 1, 2025, Quebec has increased the minimum wage to CAD 16.10 per hour from CAD 15.75 per hour.

Canada: Highlights of the Quebec budget 2025

Quebec’s Finance Minister Eric Girard presented the province’s budget for 2025 on March 25, 2025.

The key highlights of the budget 2025 are as follows:

For Individuals

Changes to personal income tax thresholds –

There is no change in individual income tax rates. The Quebec income tax brackets are indexed to inflation every year. The tax brackets for 2025 are as follows:

Financial Year 2025		Financial Year 2024		2025 & 2024
Taxable Income Thresholds (in CAD)	Constant (in CAD)	Taxable Income Thresholds (in CAD	Constant (in CAD)	Tax rate
Up to 53,255	0	Up to 51,780	0	14%
53,256 to 106,495	2,662	51,781 to 103,545	2,589	19%
106,496 to 129,590	7,987	103,546 to 126,000	7,766	24%
129,591 and above	10,255	126,001 and above	9,971	25.75%

Reduction in age criteria for availing refundable tax credit for childcare expenses –

Childcare expenses incurred by taxpayers give rise to a refundable credit, which is subject to an annual limit. The tax credit to be availed depends on and changes according to the age of the child, for whom the expenses are incurred. With reference to this, the age limit mentioned in the definition of “eligible child” for availing the tax credit is proposed to be reduced from 16 years to 14 years from the tax year 2026.

For Employers and Companies

Corporate income tax rates – No change in the corporate income tax rates. The general corporate income tax rate in Quebec remains unchanged at 11.5%.
Tax credit for development of e-business (“TCEB”) –
The budget proposes changes to the refundable and non-refundable tax credits which are available for the development of e-business. These tax credits provide tax assistance to businesses in the information technology sector that carry out e-business activities, notably in the fields of computer systems design and software publishing. The budget proposes following changes:
Reduction in the tax assistance granted to corporations that carry out intercompany outsourcing for applications which are to be used exclusively outside Quebec.
The list of eligible activities for availing the TCEB is proposed to be updated.

These amendments will generally apply for both refundable and non-refundable tax credits for taxation years beginning after December 31, 2025.

Tax credit (i.e., TCEB) rates remain unchanged (except mentioned above), which are as follows:

Year	2025	2026	2027	2028 onwards
Refundable tax credit	23%	22%	21%	20%
Non-refundable tax credit	7%	8%	9%	10%

A new tax assistance system to boost scientific research and experimental development (“R&D”) activities –

The budget proposes an overhaul of the R&D tax credit regime by introducing the tax credit to eligible entities for R&D, innovation, and pre-commercialization (“CRIC”) activities and repealing several existing tax credits. The tax credit will be at 20% and may be increased to 30% in respect of eligible expenditure up to maximum of CAD 1 million. The regime will apply to taxation years beginning after March 25, 2025.

Implication:
The employers should make a note of the budget changes and monitor related developments.

Chile:

Chile: Minimum monthly wages increased to CLP 510,500 from CLP 500,000 with effect from January 1, 2025.

Through Law 21.578 – ‘The Law on the adjustment of minimum wage and other benefits’ dated February 6, 2025, which mandates the progressive increases to the minimum monthly wages (“Ingreso Minimo Mensual – IMM”) in Chile, the Chilean government has implemented a rise in the minimum monthly wages to CLP 510,500 from CLP 500,000 for workers aged between 18-65 years with effect from January 1, 2025.

Chile: Published significant reforms to the Chilean Pension System which includes phased increase in the employers’ contributions by 2035.

On March 26, 2025, Law No. 21,735 covering major pension reforms was published in the Official Gazette. The new law outlines significant changes to the pension system and employers’ contributions, with various aspects being implemented gradually over the years.

The reform includes the following key changes:

Replacement of the previous fund types with ‘Generational Funds,’ a new system of age-based investment funds that adjust risk over time;
Creation of a new social security pension system, that will be funded by employers’ contributions to a new state-managed fund “called Autonomous Pension Protection Fund” (“FAPP”); and
Gradual increase in employers’ contributions.

Currently, the employers’ contributions consist of following components as a percentage of employees’ taxable income:

approximately 1.5% for Disability and Survival Insurance (“SIS”);
2.4% towards Unemployment Insurance; and
a variable amount for Labor Accidents and Professional Disease Insurance, depending on the company’s activity and risk level (with an approximate 0.9% base rate).

The employers’ contributions will change in phases, with additional contributions of 7% directed towards the abovementioned Autonomous Pension Protection Fund (“FAPP”) and Employee’s Individual Pension Fund Accounts (“AFP”), resulting into increase in total contribution to the SIS from earlier 1.5% to 8.5%.

The breakdown of the employer contribution changes, progressing from the current scenario to the planned structure is as under:

Employers’ Contribution	Current System	Initial Phase (August 1, 2025)	Intermediate Phase (August 1, 2026, onwards)	Final State (By August 1, 2035)
1. Unemployment insurance	2.4% (remains unchanged)
2. Labor accidents and professional disease insurance (variable)	0.9% base rate and maximum of 3.4 % (remains unchanged)
3. Employer’s Contribution to Employee’s individual Pension Fund Account (“AFP”)	–	0.1%	0.1% and gradual increase	4.5%
4. New state-managed fund “Autonomous Pension Protection Fund” (“FAPP”)	–
– SIS: Disability and survival insurance. Under the new regime SIS also includes women’s life expectancy compensation	1.5 %	1.5 %	2.5%	2.5 %
Benefit per contributed year (“CPU”)	–	0.9%	0.9% and gradual increase	1.5%
Total employers’ additional contribution (AFP + FAPP)	1.5%	2.5%	3.5% and gradual increase	8.5%

Implication:
Employers will need to update their payroll and social security policies considering the revised contribution bases and rates.

China

China: New Personal Information Protection Compliance Audit Management Measures effective from May 1, 2025.

On February 14, 2025, the Cyberspace Administration of China (“CAC”) released the Personal Information Protection Compliance Audit Management Measures (“the Measures”) along with guidelines, which were approved on May 20, 2024. The measures will be effective from May 1, 2025. These measures aim to ensure compliance with Chinese data protection laws and complement the Personal Information Protection Law (“PIPL”) compliance audits conducted within China.

The key highlights of the measures:

Companies that process personal information of more than 10 million individuals must conduct the personal information protection compliance audit at least once every two years.
Under certain circumstances the personal information protection authorities may require the personal information processors to appoint a professional organization to conduct the compliance audit.
Personal information handlers which conduct personal information protection compliance audits on their own or through professional organizations are required to refer to the “Guidelines for Personal Information Protection Compliance Audits,” which are annexed to these Measures.
The personal information handler which conducts the audit through professional organization must ensure that the audit is completed within specified time limit, and they are required to submit a personal information protection compliance audit report to the protection department.
Personal information handlers must address issues identified in compliance audits as required by the protection department and submit a rectification report within 15 working days after completing the corrections.
A personal information processor that handles the personal information of more than 1 million individuals shall appoint a personal information protection officer who will be responsible for the personal information protection compliance audit of the personal information processor.
The “Guidelines for Personal Information Protection Compliance Audits” lay down in detail the matters which need to be examined while conducting the audit.

Additionally, the professional organizations conducting compliance audit are required to comply with the measures and guidelines, to act unbiased and to ensure that the personal information and trade secrets collected while performing the compliance audit are kept confidential and not shared illegally to third parties. Once the compliance audit is completed, the relevant information has to be deleted within specified due date.

Implication:
Companies acting as personal data handlers and meeting the criteria for applicability of compliance audit must take a proactive approach to compliance, ensuring that they meet the audit requirements to avoid legal and financial risks.

Costa Rica

Costa Rica: Extended the timeline for e-invoicing until September 1, 2025.

On February 11, 2025, the Ministry of Finance issued Bulletin CP-08-2025, extending the deadline to implement changes in electronic invoices (“e-invoices”)—specifically version 4.4 (as established in Resolution MH-DGT-RES-0027-2024 of the General Directorate of Taxation), until September 1, 2025, which was initially set for February 11, 2025.

Version 4.4 introduces updates to the technical structure and data requirements of Costa Rica’s e-invoicing system, including new definitions for electronic and provisional receipts, exceptions for certain taxpayers, and mandatory use of credit or debit notes when receipts are cancelled.

Implication:
Businesses will need to revise their processes to enable compliance with the new e-invoicing regulations.

Denmark

Denmark: Amendments to the Danish Companies Act effective from January 1, 2025.

The Danish Parliament through ‘Bill 71’ dated November 5, 2024, has modified certain provisions of the Danish Companies Act relating to minimum share capital requirement for incorporating private limited companies and ways by which private company can raise capital. The bill was passed on December 19, 2024, and the amendments are effective from January 1, 2025.

The amendments are as under:

Reduction in minimum share capital requirement-
Effective from January 1, 2025, the private companies can now be incorporated with a minimum share capital of DKK 20,000 (previously DKK 40,000).

Raising of capital through public share offering –
Earlier, the private companies were not allowed to raise capital by offering shares to the public. As per the amendment, the private companies can now raise capital by following ways:
Through equity crowdfunding-
Private limited companies are permitted to offer shares to the public through equity crowdfunding platforms. Under the equity crowdfunding, companies can raise capital by offering unlisted shares to the public through online platforms. Such platforms facilitating crowdfunding are required to comply with the Crowdfunding Regulations ensuring investor protection.
By direct offering-
The private companies can now raise capital by directly offering shares to the qualified investors. This is as per the provisions applicable to the public limited companies of allowing share offerings without the need for a prospectus. The offering can be made to the following:

– Offering shares exclusively to qualified investors; or
– Offering shares to less than 150 non-qualified investors per European Union (EU)/European Economic Area (EEA) country; or
– Offering shares having nominal value of minimum EUR 100,000; or
– Offering shares in such a way that each investor acquires shares amounting to at least EUR 100,000.

Implication:
The companies need to make note of these amendments and take benefit as necessary.

European Union

European Union: European Council formally adopts VAT in Digital Age (“ViDA”) agreement

On March 11, 2025, the European Council formally adopted VAT in the Digital Age (“ViDA”) package, with the aim to digitize the VAT system across EU and simplify the VAT processes. On March 25, 2025, an EU Council Directive (2025/516), which amends the current VAT rules (Directive 2006/112/EC) to address the digital age, was published in the Official Journal of the European Union (“OJEU”). The directive has become legally binding twenty days after its publication. Further, alongside the directive, there is a Council Implementing Regulation (2025/518), issued on March 11, 2025, amending an earlier regulation (EU No 282/2011) to clarify how the changes in the directive should be interpreted and applied. The agreement is proposed to be implemented in phased manner starting in the year 2025 and to be completed by year 2035.

ViDA initiative consists of three pillars as under:

E-invoicing and digital reporting : Effective from April 14, 2025, the EU member states are not required to seek a derogation from the EU Council to make the e-invoicing mandatory for domestic transaction. Further, all registered businesses in the EU will be required to issue structured e-invoice for cross-border B2B and B2G transactions with effect from July 1, 2030. E-invoices will have to be issued in standard EU format within 10 days of the date of supply. Further, there would be requirement of real time digital reporting of certain e-invoicing data and periodic EC sales list will not be required. Member states will have to converge the existing reporting systems in the EU model by January 1, 2035.
Platform Economy: From April 1, 2028, digital platforms which act as an intermediary or agent with respect to supply of short-term accommodation rentals and passenger transport services by road, will be treated as deemed suppliers subject to certain exclusions. Member States can postpone application of this provision until January 1, 2030.
Single VAT registration: The e-commerce package will be updated, expanding the One-Stop Shop (“OSS”) to other B2C supplies including the supply of electricity and natural gas. Extension of OSS to electricity and natural gas will be effective from January 1, 2027, while for other B2C supplies relating e-commerce, supplies of goods with installation and goods sold on the board of ships, aircrafts, etc., the effective date is July 1, 2028. A single VAT registration system will be implemented, extending the OSS to cover all B2C supplies, stock transfers, and mandatory reverse charge mechanisms. The third pillar proposes a single VAT registration system across the EU, allowing businesses to manage their tax obligations with just one registration.

Implication:
Businesses will have to comply with new rules for electronic invoicing as part of the VAT system, as and when they are enforceable and prepare a plan for the updation of their processes and systems.

France

France: Parliament approved Finance Bill for 2025

The French Parliament adopted the Finance Bill, 2025 and consequently, the Finance Act 2025 was published in the official gazette on February 14, 2025. The budget for 2025 was originally proposed in October 2024, however due to fall of the ruling government, the Finance Bill 2025 could not be approved. Hence, the French Parliament had earlier approved the Special Finance Bill, 2025 on December 18, 2024, which continued the applicability of existing provisions until the new Finance Bill is passed.

The following are the key provisions and amendments introduced in the Finance Act 2025:

Amendment relevant for companies:
Business Contribution on Added Value (“CVAE”):
The Business Contribution on the Added Value (“CVAE” or “Cotisation sur la Valeur Ajoutée des Entreprises”) which was originally planned to be abolished by 2024 and then extended to 2027, will now be eliminated by 2030. The top CVAE tax rate of 0.28% for 2024 will remain unchanged until 2027. The previously scheduled reduction to a top rate of 0.19% in 2025 has been postponed to 2028 and further reduction to 0.09%, originally planned for 2026, will also take effect in 2028. The complete abolition of CVAE is now set for 2030.

Territorial Economic Contribution (“CET”):
The cap on the Territorial Economic Contribution (“CET”) which includes the CVAE and the real estate contribution (“CFE”), will remain at 1.531% of value added until 2027. It will then be gradually reduced to 1.438% in 2028, 1.344% in 2029, and 1.25% from 2030 onward.

Surtax for large companies:
The government has introduced a temporary extra tax (surtax) on the corporate income tax paid by very large companies, specifically, those with group-level annual turnover of at least EUR 1 billion. It applies for the fiscal years ending on or after December 31, 2025. The surtax rates are:
– 20.6% for companies with turnover between EUR 1 billion and EUR 3 billion (in both the current and prior year);
– 41.2% for companies with turnover above EUR 3 billion (in either the current or prior year).

Updates to GMT Rules:
Amendments to the Pillar 2 global minimum tax rules have been made to incorporate the latest OECD administrative guidance and to make other adjustments.
Personal Income Tax (“PIT”):
Adjustment to tax scales for resident individuals
Tax scales for resident individuals adjusted to factor in inflation effect as under:

Tax Rate	Tax Slabs (2025)	Tax Slabs (2024)
0%	Up to EUR 11,497	Up to EUR 11,294
11%	EUR 11,498 to EUR 29,315	EUR 11,295 to EUR 28,797
30%	EUR 29,316 up to EUR 83,823	EUR 28,798 to EUR 82,341
41%	EUR 83,824 up to EUR 180,294	EUR 82,342 to EUR 177,106
45%	Above EUR 180,294	Above EUR 177,106

A special tax (exceptional contribution) is being introduced for the year 2025 to ensure that high-income households pay at least a minimum tax rate of 20%. This applies to individuals earning more than EUR 250,000, or couples earning more than EUR 500,000. If these taxpayers end up paying less than 20% tax on average (after deductions, credits, etc.), they will have to pay an additional amount to bring their tax rate up to 20%. This measure was originally proposed for 2024 to 2026 but is now set to apply from 2025.

Tax regime for management package gains: Gains arising on shares acquired or subscribed or allotted to employees or executives are taxable as capital gains if they are within the specified limit. Any gains beyond the limit are taxable as employment income. The limit is set at 3 times the financial performance of the company for period during which the security is held as reduced by the price paid by the employee.

Implication:
The French Finance Act of 2025 contains a number of significant changes that will have a broad impact on both multinational corporations and domestic businesses. Companies need to closely evaluate these changes and adjust their strategies accordingly.

France: New declaration form for CbCR and Pillar Two notification published.

On January 27, 2025, the French tax authorities published Form 2065-INT-SD, which will apply as a notification for companies subject to Country-by-Country Reporting (“CbCR”) or the Global Minimum Tax (“Pillar Two”) compliance.

The form has two sections of which Section I covers the CbCR notification while Section II is Pillar two notification. Section I is similar to earlier from 2065-SD which was to be submitted together with the company’s annual tax return. The new form is also required to be submitted with the annual tax return. The form requires key information including the name, address, and tax number of the ultimate parent entity (“UPE”), the entity responsible for filing the group information return (“GIR”) if different from the UPE, and details of the French entity responsible for submitting the qualified domestic minimum top-up tax (“QDMTT”) and paying any additional top-up tax, if applicable. For entities having year-end as December 31, 2024, the deadline for submission of the form is May 19, 2025, if filing electronically.

Implication:
Companies subject to CbCR and Pillar two compliance should take note of the changes in notification requirements.

Germany

Germany: Germany increased the Intrastat thresholds for arrivals and dispatches effective from January 1, 2025.

On February 14, 2025, the Bundesrat approved changes to the Intrastat reporting thresholds, with retroactive effect from January 1, 2025. The updated thresholds are as follows:

Arrivals: Increased from EUR 800,000 to EUR 3 million per annum
Dispatches: Increased from EUR 500,000 to EUR 1 million per annum

These changes form part of the amendments to the Foreign Trade Statistics Law aimed at streamlining reporting obligations for businesses.

Implication:
Businesses will need to follow revised thresholds for submission of Intrastat returns.

Greece

Greece: Introduces changes in the social security contributions for 2025.

Effective from January 1, 2025, Greece has implemented significant changes to its social security contributions, including an increase in the employee’s monthly contribution cap for the Unified Social Security Fund (“EFKA”), a reduction in both employee and employer health insurance contribution rates as under:

Particulars	Financial Year 2025	Financial Year 2025
Maximum Monthly Contribution Basis Cap (on employee’s salary	EUR 7,572.62	EUR 7,373.53
Employees’ Contribution Rate	13.37% (including 2.05% for health)	13.87% (including 2.55% for health)
Employer’s Contribution Rate	21.79% (including 4.05% for health)	22.29% (including 4.55% for health)
Total Contribution Rate (Employee + Employer)	35.16%	36.16%
Overtime / Holiday Work Contributions	Based only on standard hourly wage	Based on total earnings (including premium)

With effect from March 15, 2025, the social security contribution base for overtime, additional hours, night shifts, and work on Sundays and public holidays has been revised to the standard hourly wage only, a change from the previous basis of total earnings (including premiums).

Implication:
The employers need to take into account these changes while processing payroll of the employees.

Greece: Increase in the monthly minimum wages effective from April 1, 2025.

With effect from April 1, 2025, Greek private sector employees will see an increase in minimum wages. According to Greek Ministerial Decision No. 8233/27.3.2025, the minimum monthly wage has been raised from EUR 830 to EUR 880, and the minimum daily wage has increased from EUR 37.07 to EUR 39.03.

Hong Kong

Hong Kong: Announces increase in hourly statutory minimum wage (“SMW”) from HKD 40 to HKD 42.10 effective May 1, 2025.

Through the Minimum Wage Ordinance (Amendment of Schedule 3) Notice 2025, dated February 18, 2025, Hong Kong government has raised the hourly minimum wages from HKD 40 to HKD 42.10 with effect from May 1, 2025. However, employers in Hong Kong will be exempt from recording employees’ working hours if monthly wages reach HKD 17,200 (currently HKD 16,300).

Hong Kong: Highlights of the budget 2025-26.

The Finance Secretary of Hong Kong, Mr. Paul Chan, presented the budget for the year 2025-26 on February 26, 2025. In 2024, Hong Kong’s economy witnessed moderate growth of 2.5%. The budget projects a 2% to 3% growth for the Hong Kong economy in 2025, with an expected average inflation rate of 1.8%.

The key proposals of the Budget 2025-26 are as under:

There are no changes proposed in the corporate income tax (Profit Tax) rates, however, the Budget proposes a reduction of 100% profit tax for the tax year 2024–25 with a ceiling of HKD 1,500 (similar reduction was granted for the tax year 2023–24 but with a higher ceiling of HKD 3,000). The reduction will be reflected in the final tax assessment for the tax year 2024–25.
The Budget speech further states that the bill for implementation of global minimum tax at 15% on large multinational entities has been submitted before the Hong Kong Legislative Council in January 2025 and is yet to be passed.
Budget proposes a 100% reduction of “salaries tax” and “tax under personal assessment” up to a ceiling of HKD 1,500 for the tax year 2024–25 (similar reduction was provided earlier with ceiling of HKD 3,000 for tax year 2023-24). This will be reflected in the final tax payable for the tax year 2024-25.
Property tax concessions: Under the property tax regulations (known as ‘Rating system’), a property tax (‘rate’) is payable at a specified percentage of the assessed ratable value of the property i.e., estimated annual rental value of the property less certain deduction. Government considers, on an annual basis, granting of rates concession based on the prevailing circumstances. The budget proposes a rate concession for domestic and non-domestic (including offices) properties only for the first quarter of the tax year 2025–2026, subject to a ceiling of HKD 500 (in 2024 the concession was HKD 1,000).
Adjustment to the stamp duty on domestic and non-domestic property transactions: The maximum property value eligible for the HKD 100 stamp duty has been raised from HKD 3 million to HKD 4 million while other rate adjustments are as under:

Ad valorem stamp-duty rate after adjustment
Amount or value of the consideration (in HKD)	Rates
Up to 4,000,000	HKD 100
4,000,001 – 4,323,780	HKD 100 + 20% of excess over HKD 4,000,000
4,323,781- 4,500,000	1.50%
4,500,001 and above	Same as existing arrangements

More details on the budget proposals can be accessed on our website.

Implication:
Businesses should evaluate impact of the budget proposals such as reduction in profit tax for tax year 2024-25, changes to stamp duty of property transactions, rates concession and other industry specific proposals.

Hong Kong: Inland Revenue Department extends deadline for 2024/25 tax returns under the block extension scheme

Hong Kong Inland Revenue Department (“IRD”), vide circular letter dated March 19, 2025, has announced extensions of the due dates for 2024/25 profit tax returns as follows. The extension is available under the block extension scheme which is applicable to taxpayers filing their returns through tax representatives.

Accounting Date and Code	Extended Due Date	Electronic Due date	Conditions
April 1, 2024 – November 30, 2024 (For N code returns)	No Extension	No Extension	N/A
December 1, 2024 – December 31, 2024 (For D code returns)	August 15, 2025	September 15, 2025 (1-month further extension for electronic filing)	N/A
January 1, 2025 – March 31, 2025 (For M code returns)	November 17, 2025	December 17, 2025 (1-month further extension for electronic filing)	N/A
Current year loss cases for the tax year 2024/25 (for “M” code returns)	February 2, 2026	February 2, 2026	Have allowable losses for the year of assessment 2024/25.

Implication:
Companies filing returns through their tax representatives should take advantage of the extended timeline.

Hong Kong: Increase in compensation levels for work injuries and occupational diseases effective April 17, 2025.

The Labor Department (“LD”) on March 21, 2025, announced increase in the compensation levels for employees injured at work or suffering from prescribed occupational diseases starting April 17, 2025. The adjustment also applies to family members of deceased employees, individuals affected by pneumoconiosis or mesothelioma, and those suffering from occupational deafness. The compensation is generally payable by the employer who is also required to buy a mandatory insurance in this respect.

This follows the passing of three resolutions by the Legislative Council on March 20, 2025, to amend compensation provisions under the Employees’ Compensation Ordinance (“ECO”), the Pneumoconiosis and Mesothelioma (Compensation) Ordinance (“PMCO”), and the Occupational Deafness (Compensation) Ordinance (“ODCO”). The amendments were gazetted and are effective from April 17, 2025.

The new compensation levels apply to:

Employees injured at work or suffering from prescribed occupational diseases under the ECO, or their family members in case of death;
Individuals diagnosed with pneumoconiosis or mesothelioma, or the family members of those who pass away from these diseases; and
Persons suffering from occupational deafness.

A total of 18 compensation items under the three Ordinances would see increases ranging from 3.8% to 86.3%.

Implication:
Employers should review and update their employees’ compensation insurance coverage to reflect the revised compensation levels.

Honduras

Honduras: Individual income tax table published for 2025.

The Honduras Revenue Administration (“SAR”) has via its ‘Communication SAR 01-2025’ dated January 7, 2025, published the table for progressive individual income tax brackets and rates, effective from January 1, 2025:

For the year 2025	For the year 2024	2025 and 2024
Annual Salary range (amounts in HNL)	Annual Salary range (amounts in HNL)	Tax Rates
0 – 217,493.16	0 – 209,369.62	0%
217,493.17 – 331,638.50	209,369.63 – 319,251.54	15%
331,638.51 – 771,252.39	319,251.55 – 742,445.49	20%
771,252.40 and above	742,445.50 and above	25%

Implication:
Employers need to consider the updated tax rates and thresholds for calculating the tax liability of employees.

Hungary

Hungary: Hungarian government outlines expanded tax exemptions for mothers effective from October 2025 with phased rollout.

On February 22, 2025, the Hungarian government announced major reforms to its personal income tax (“PIT”) system aimed at supporting families and boosting birth rates. While the lifetime PIT exemption already applies to mothers with four or more children since 2020, the latest announcements expand this benefit to include mothers with two or three children, with a phased implementation starting from October 2025.

Key reforms announced are as follows:

Criteria	New provisions and effective date	Existing/ old provisions	Conditions	Type of income
Mothers with four or more children	Unchanged	Lifetime PIT exemption since 2020	No conditions related to mother’s age, income range or age of their children.	All income types excluding capital income like dividend or gains.
Mothers with three children	Lifetime PIT exemption from October 2025		No conditions related to mother’s age, income range or age of their children.	All income types excluding capital income like dividend or gains.
Mothers with two children – phased introduction (2026–2029)	– From January 1, 2026: Exemption for mothers under 40 – From 2027: Exemption for mothers aged 40–50 – From 2027: Exemption for mothers aged 40–50 – From 2029: Includes mothers aged 60 and above		Effective from the year based on the mother’s age. No income threshold or age limit for children.	All income types excluding capital income like dividend or gains.
Mothers aged under 30 with at least one child	Effective from January 1, 2026, full PIT exemption on entire employment income.		No conditions related to mother’s income or age of the child.	Only employment income viz. income from salaries/ wages, or other direct employment earnings.
All women under 30 irrespective of whether they are mothers		PIT exemption up to the amount of the average wage as defined by law every year since 2022.	Age condition for mother as mentioned. No age limit for children. Cannot be combined with other full PIT exemptions.	Tax exemption applies only to the employment income up to the average wage.

All the above PIT exemptions can be claimed either during the year by submitting a tax advance declaration to the employer or at year-end in the PIT return.

Implication:
Employers will be required to collect and verify declarations from eligible employees to apply the PIT exemptions. They must also adjust payroll systems to ensure accurate withholding based on the submitted declarations.

India

India: Finance Act 2025 – Highlights

On February 1, 2025, Indian Finance Minister, Ms. Nirmala Sitharaman presented the budget for the year 2025-26 before the Parliament. The Finance Ministry has now notified the Finance Act, 2025, consequent to the passing of Finance Bill, 2025 in the Parliament and presidential assent. The tax amendments listed below are applicable for Financial Year (“FY”) 2025-26 corresponding to Assessment Year (“AY”) 2026-27, unless specified otherwise.

Indian Income-tax Act (the Act) provides two tax regimes for taxation of individuals – one provides for concessional slabs / rates without allowing certain exemptions /deductions (tax regime without deductions) which is a default tax regime and the other has higher tax rates, but it allows number of deductions (tax regime with deductions). The taxpayer has the option to choose the tax regime with deductions by filing an applicable form with the income tax department.

The Finance Act 2025 amended the income slabs applicable to the default tax regime (i.e., regime without deductions) as under:

FY 2025-26		FY 2024-25
Annual Taxable Income (In INR)	Income Tax Rate	Annual Taxable Income (In INR)	Income Tax Rate
Up to 400,000	Nil	Up to 300,000	Nil
From 400,001 to 800,000	5%	From 300,001 to 700,000	5%
From 800,001 to 1,200,000	10%	From 700,001 to 1,000,000	10%
From 1,200,001 to 1,600,000	15%	From 1,000,001 to 1,200,000	15%
From 1,600,001 to Rs 2,000,000	20%	From 1,200,001 to 1,500,000	20%
From 2,000,001 to 2,400,000	25%	Above 1,500,000	30%
Above 2,400,00	30%

However, in case of tax regime with deductions, tax rates and income slabs continue to remain unchanged since FY 2022-23.

Further the Act provides a tax rebate whereby the taxpayer is not required to pay tax if his taxable income is below INR 500,000 (for tax regime with deductions) or INR 700,000 (for tax regime without deduction). This provision remains unchanged for taxable income calculated under old tax regime (i.e., tax regime with deductions). However, the Finance Act, 2025 has amended the provisions in case of tax regime without deduction, whereby no tax would be payable for the FY 2025-26 if the taxpayer’s income does not exceed INR 1,200,000, i.e., increased from INR 700,000.
The surcharge rates and cess remain unchanged.
There is no change in corporate income tax rates (“CIT”) for Indian companies as well as foreign companies including the surcharge and cess.
The existing tax benefit for eligible start-ups allows a 100% deduction on profits for 3 consecutive years within the 10 years of incorporation. To qualify, the start-up must have a turnover not exceeding INR 100 crore, hold a certification from the Inter-Ministerial Board, and be incorporated between April 1, 2016, and April 1, 2025. The Finance Act, 2025 extends this benefit by 5 years, making it available to start-ups incorporated until April 1, 2030. This change will take effect from April 1, 2025.
Various provisions in the Income-tax Act require the payer of income to withhold or deduct taxes at source (TDS) when such income crosses the threshold provided under the respective provision. The Finance Act, 2025, revise these thresholds across various categories to streamline the compliance. The updated limits effective from April 1, 2025, for the relevant category of income are as follows:

Sr. No.	Section	New threshold (after April 1, 2025) (in INR)	Existing threshold (before April 1, 2025) (in INR)
1	193 – Interest on securities	10,000	Nil
2	194A – Interest other than Interest on securities	(i) 100,000 for senior citizen (ii) 50,000 in case when payer is bank, co-operative society, and post office. (iii) 10,000 in other cases.	(i) 50,000 for senior citizen (ii) 40,000 in case when payer is bank, co-operative society, and post office. (iii) 5,000 in other cases.
3	194 – Dividend paid to an individual shareholder	10,000	10,000
4	194H – Commission or brokerage	20,000	15,000
5	194-I Rent	50,000 per month or part of month	2,40,000 during the financial year
6	194J – Fee for professional or technical services or royalty	50,000	30,000

The provision of deducting or collecting higher rate of tax at source is in cases of deductee or collectees who are non-filer of the tax return is repealed from April 1, 2025.
In 2022, the filing of updated return facility was introduced, which is irrespective of filing of original/ belated/ revised return, for encouraging voluntary compliance by the taxpayers in respect of reporting omitted/ incorrect income. The Finance Act, 2025, extends the time-limit to file updated return for any assessment year, up to 48 months from the end of the relevant assessment year along with additional tax up to 70% (based on the period of delay). Earlier the period to file an updated return was up to 24 months with payment of additional income-tax in the range of 25-50% (based on the period of delay) of aggregate of tax and interest payable for the updated return. The amendment took effect from the April 1, 2025, i.e., from AY 2025-26.
If the non-resident taxpayers and foreign companies has a significant economic presence in India, it will constitute a business connection resulting in income being considered as deemed to accrue in India. As per the Finance Act, 2025, where non-resident’s operations are restricted to purchase of goods in India for the purpose of export, then such operations would not constitute significant economic presence in India.
The Finance Act, 2025 withdraws equalization levy which was payable at 6% on gross payments made to non-residents without physical presence in India for online advertisements and related services. However, such services would be taxable under significant economic presence rules if the consideration exceeds the prescribed threshold subject to treaty relief applicable.
The Finance Act, 2025, makes the arm’s length price (“ALP”) determination under the transfer pricing provisions for the year applicable for the subsequent 2 years at the option of the taxpayers. The taxpayer would need to exercise the option in the form and manner provided in this respect.
It is also proposed to expand the scope of the safe harbor rules for transfer pricing to provide certainty and reduce litigation. Where the taxpayer’s transaction price meets the safe harbor prescribed, no transfer pricing audit to determine the arm’s length price will be conducted by the tax authorities.
The Finance Act, 2025 has introduced a presumptive taxation scheme for non-resident supplying technology and services to Indian electronics manufacturers. 25% of the gross receipts would be deemed to be taxable income which would be subject to tax rate of 35% (plus applicable surcharge and cess) applicable to non-resident companies. If the non-resident opts for the scheme, the other provisions of the income-tax Act which mandates taxation of onshore services on net basis and offshore services on gross basis will not apply.

Please refer to the detailed article on India budget on our website for more information and illustrations of tax liability of individual taxpayers calculated at different income levels and under different options.

Implication:
Employers should take note of changes in personal tax rates and adjust their payroll processing accordingly. Companies should evaluate the impact of other amendments regarding computation of business income, non-resident taxation and transfer pricing.

India: MCA extends the dematerialization deadline up to June 2025

The Ministry of Corporate Affairs (“MCA”) of India has revised the timeline of mandatory dematerialization of shares for non-small private companies, by amending the Companies (Prospectus and Allotment of Securities) Amendment Rules, 2025, vide notification dated February 12, 2025.

The MCA had introduced mandatory dematerialization of securities for non-small private companies, which were required to mandatorily convert their physical securities into demat form as per the provisions of the Depositories Act, 1996 before September 30, 2024. Now the timeline has been further extended to June 30, 2025.

India: India releases draft Digital Personal Data Protection Rules, 2025

On January 3, 2025, the Ministry of Electronics and Information Technology (“MeitY”) issued the Draft Digital Personal Data Protection Rules, 2025, (Draft Rules) under Section 40 of the DPDP Act, 2023. These Draft Rules will provide the implementation framework for the DPDP Act once they come into effect. The implementation of rules may take place in phased manner rather than all at once.

The key provisions of the draft rules are as under:

Notice requirements: As per the DPDP Act, 2023, the data fiduciary while making request for consent of the data principal, must provide a notice specifying the nature of personal data collected, purpose and other details. With reference to these provisions, the Draft Rules outline specific requirements for the notice that a data fiduciary must provide to data principal. The notice by the data fiduciary to data principal must be clear, independent, and easily understandable. It should provide an itemized list of personal data collected, the purpose of processing, and the services enabled. It must also include a link to the website/application for further details and to allow the data principal to withdraw consent easily and exercise their rights under the DPDP Act.
Consent management: The DPDP Act has introduced a concept of ‘consent managers’ who are entities that provide platforms allowing data principal to give, manage, review and withdraw consent for sharing their data with different companies. To operate, they must be registered with the Data Protection Board of India (“DPBI or the Board”) and meet certain requirements outlined in the ‘First Schedule’ of the Draft Rules. These requirements include being incorporated in India, having a net worth of at least INR 20 million, maintaining financial stability, and using a certified platform. The part-B of the Schedule further outlines the obligation of the consent managers, including, but not limited to, maintaining consent records for at least seven years, conducting regular audits, ensuring transparency by publicly sharing management details, and refraining from outsourcing their duties or changing ownership without approval.
Security safeguards: As per the DPDP Act, one of the key responsibilities of a data fiduciary is to protect the personal data by taking reasonable safeguards and implementing appropriate measures outlined in the Draft Rules. A data fiduciary must implement security measures to prevent data breaches, including encryption, access control, monitoring, and data backups. Unauthorized access must be tracked, investigated, and prevented through logs retained for at least one year unless required otherwise by law. Contracts between data fiduciaries and data processors must include security provisions, and technical and organizational measures should ensure effective data protection.
Personal data breach intimation: In the event of data breach, the data fiduciary must inform the data principal and notify the Board about the incident. Affected individuals must be notified promptly through a registered mode of communication or their user accounts, detailing the nature of the breach, its impact, mitigation measures and safety precautions taken by the data fiduciary and the contact information of the person responsible for addressing the queries. Additionally, the Board must be informed immediately within 72 hours, through a detailed report providing information about the breach, its nature, mitigation measures and safety precautions taken, individual responsible for cause, if any, and report given to the affected data principals.
Time period for data retention and erasure: Draft Rules prescribe time limit of 3 years for retention of personal data for entities such as e-commerce entities (with more than 20 million users), gaming intermediaries (with more than 5 million users), social media intermediaries (with more than 20 million users) beyond which the data shall be erased. Such entities need to intimate users at least 48 hours prior to expiry of such period and data is required to be deleted unless the user contacts the entity or log into their account to retain the data.
Rights of data principals: Data fiduciaries and consent managers must provide clear guidelines on their website/application for data principals to exercise rights, including access, erasure, and nomination. They must publish grievance redressal timelines and ensure timely responses by implementing appropriate technical and organizational measures.
Cross border transfer of personal data: Personal data processed within India or outside India for offering goods and services to data principals in India, can only be transferred to foreign countries or entities under foreign state control if it meets the requirements set by Central Government.
Verifiable consent for processing personal data of children and persons with disabilities: The DPDP Act, 2023, mandates the data fiduciary to obtain verifiable consent of the parent or lawful guardian in case of processing personal data of a child or person with disability. The Draft Rules outline the requirements and process to obtain a verifiable consent. A data fiduciary must confirm that the person giving consent is the child’s parent or guardian and verify their identity as an adult using reliable identity details or virtual tokens.
Obligations of significant data fiduciaries: They should conduct data processing impact assessment and data privacy audit once a year and submit the report to the Board. They are also required to check that algorithmic software used by them are not posing any risks to the privacy rights of the data users.

While the DPDP Act was enacted on August 11, 2023, the enforcement date of DPDP Rules is yet to be gazetted by the Central Government, which may implement provisions in phases.

Implication:
Companies should monitor developments relating to the proposed rules and prepare themselves by aligning their data processing, security, and compliance strategies with the upcoming regulations to ensure smooth adaptation once the act and rules become effective.

India: Newly introduced Income Tax Bill 2025 expected to replace the existing Income Tax Act in the year 2026.

As announced by the finance minister Nirmala Sitharaman during her Budget 2025 speech, the new Income Tax Bill (“the bill”) was introduced on February 13, 2025, before the Lok Sabha (the lower house of the Indian Parliament). The new income tax bill proposes to replace the existing Income-tax Act, 1961 with effect from April 1, 2026. The bill needs to be passed by both the houses of the Parliament and receive presidential assent to become a law.

The existing income tax law has undergone several amendments and has become very bulky and complex due to use of explanations and provisos added to clarify legislative intent, the existence of redundant provisions which have become non-operational over time, etc. The exercise to draft a new income-tax bill was undertaken to make the law ‘concise, lucid and easy to read and understand.’

The following are the key features of the bill:

The new bill removes redundant provisions and reduced the length of the income-tax law by nearly half. The bill runs into 622 pages, divided in 23 chapters, 536 sections along with 16 schedules. The current Income-tax Act has 47 chapters and 819 effective sections.
The drafting is straightforward and clear. Further, the bill uses tables and formulae to make provisions easier to understand and removes provisos and explanations used in the original income-tax Act. Sub-sections and clauses have been used instead of proviso and explanation for exceptions and carve-outs. A dedicated interpretation section is added under certain chapters or sections in order to reduce potentially legal ambiguity.
The government has also issued frequently asked questions on the bill which states that there is no policy related change in the bill while it incorporates the changes proposed by the Finance Bill, 2025. It also clarifies that there is no change in rates/slabs/available tax regimes.
One of the major changes in the new bill is the introduction of the term ‘Tax Year’. The existing law uses the term ‘previous year’ (which is a financial year for which tax liability is calculated) and ‘assessment year’ (which is the year in which tax return is filed to assess the tax liability). Removing these two concepts, the new bill introduces a single ‘Tax Year’ concept. However, the tax year will continue to be April to March and there is no shifting to calendar year.
The scope of income chargeable to tax also remains unchanged and income continues to be classified under 5 heads of income viz salaries, income from house property, profits and gains from business or profession, capital gains and income from other sources.
The Government has clarified that there is no change in due date for filing tax return for various taxpayers as well as the provisions relating to penalties or prosecution.

Implication:
New Bill once enacted should simplify the existing income tax law, but it is not currently proposing any significant changes in the provisions.

Indonesia

Indonesia: Indonesia implements Global Minimum Tax effective from January 1, 2025.

On December 31, 2024, Indonesia’s Finance Minister issued ‘Regulation No. 136 of 2024’ (‘PMK-136’). This Regulation introduces the Pillar 2 top-up taxes in Indonesia by implementing the Organization for Economic Cooperation and Development (“OECD”)’s Pillar Two Global Minimum Tax and introducing the global anti-base erosion (“GloBE”) regulations. The provisions introduce a 15% minimum effective tax rate for companies that are part of multinational and domestic groups with consolidated revenue of at least EUR 750 million in at least two of the previous four years, effective from the financial years starting on or after January 1, 2025.

The provisions include:

Domestic Top-up Tax (“DTT”) – This domestic top up tax of 15% applies to qualifying companies and permanent establishments (i.e., constituent/ member companies of the group) in Indonesia with an effective tax rate below 15%.
Income Inclusion Rule (“IIR”) – This is payable by the Indonesian parent companies (i.e., Ultimate parent entity of the group) with respect to their foreign low-tax constituent/ member companies. The IIR applies to financial years commencing on or after January 1, 2025.
Undertaxed Profits Rule (“UTPR”) – The UTPR generally applies where the jurisdiction/ country of the ultimate parent company of the group has not introduced the provisions of global minimum tax. In such cases, the constituent/ member company in Indonesia pays the UTPR in respect of foreign low-tax constituent/ member companies i.e., for which the ultimate parent company has not applied equivalent minimum top up tax in its own country in the absence of the regulations. The UTPR will apply to financial years commencing on or after January 1, 2026.
Further, a de minimis exclusion is provided in respect of multinational or national group companies located in a jurisdiction when their aggregate revenues and profits are less than EUR 10 million and EUR 1 million, respectively, on average over a three-year period. Under the exception, the top up tax is presumed to be zero.

The filing/ compliance obligations include the following:

Global Information Return and notification (“GIR”): The return and notification are required to be filed by every constituent/ member company or one designated constituent/ member company in Indonesia within 15 months (within 18 months only in the first year) from the end of the financial year.
Annual top-up tax return and payment: This is actual return of top-up tax such as DMTT and UTPR, which is required to be filed in Indonesia within 4 months from the end of the financial year. The payment is to be made by the end of the following year.

Implication:
The companies meeting the prescribed thresholds need to take note of these changes.

Indonesia: Minister of Law issues new regulation on corporate beneficial ownership

The Indonesian Minister of Law (“MoL”) issued a new Regulation No. 2 of 2025 on Corporation Beneficial Ownership verification and supervision (‘MoLR 2/2025’), thereby revoking the earlier Regulation No. 21 of 2019. Both the regulations contain provisions regarding obligations of the company to identify its beneficial owner, reporting the beneficial owner’s information to the Minister of Law, and verification of the authenticity of the company’s beneficial owner’s details. The provisions of the new regulation are effective from February 4, 2025.

Key features of the Regulation are as under:

Scope expanded: The provisions are now applicable to private partnerships also. Previously, the law was applicable to limited liability companies, limited and unlimited partnerships, associations etc.
Reporting obligations: The Regulation mandates updating the beneficial ownership information on annual basis and required the company to answer the questionnaire relating to beneficial ownership electronically.
Verification and risk assessment of beneficial owner: The verification of the beneficial owner is conducted by risk assessment (based on money laundering and terrorism financing) and is carried out by the relevant company, a notary, the MoL and other authorities.
Administrative sanctions: The previous law did not emphasize on any penalties or administrative sanctions. The Regulation has imposed administrative sanctions in the form of warnings, blacklisting the name of the defaulting company or blocking the online access for the defaulting organization.

Implication:
The companies need to take note of these recent developments and revise their internal policies for effective identification of beneficial ownership information and periodically report the beneficial ownership information to MoL.

Japan

Japan: Japan enacts tax reforms for 2025; key changes include revision in basic and employment income deduction and 4% special defense corporation tax effective from 2026.

On March 31, 2025, Japan enacted the tax reforms proposals 2025 by publishing the amendment laws, Cabinet orders, and ministerial ordinances in Special Issue No. 8 of the Official Gazette.

The key changes are as under:

Individual taxation:
Basic deduction and Employment Income deduction: In order to alleviate the effect of inflation, Japan has revised the basic income tax deduction from JPY 480,000 to JPY 950,000 depending upon the income level. Further, the minimum employment income deduction is revised from JPY 550,000 to JPY 650,000 for income up to JPY 1.9 million. The combined effect of these adjustments is that the income threshold for taxation stands increased from JPY 1.03 million to JPY 1.6 million (after considering the above two deductions).

The revised basic deduction applicable to the year 2025 and 2026 is as under:

Amount of Total Income (in JPY)	Basic Deduction
Amount of Total Income (in JPY)	New Amount (in JPY)	Previous Amount (in JPY)
Up to 1,320,000	950,000	480,000
1,320,001 to 3,360,000	880,000
3,360,001 to 4,890,000	680,000
4,890,001 to 6,550,000	630,000
6,550,001 to 23,500,000	580,000
23,500,001 to 24,000,000	480,000
24,000,001 to 24,500,000	320,000	320,000
24,500,001 to 25,000,000	160,000	160,000
25,000,001 and above	0	0

From 2027 onwards, the basic deduction will be allowable as under:

Amount of Total Income (in JPY)	Basic Deduction
Amount of Total Income (in JPY)	New Amount (in JPY)	Previous Amount (in JPY)
Up to 1,320,000	950,000	480,000
1,320,001 to 23,500,000	580,000
23,500,001 to 24,000,000	480,000
24,000,001 to 24,500,000	320,000	320,000
24,500,001 to 25,000,000	160,000	160,000
25,000,001 and above	0	0

The above amendments will be applied for national income tax purpose from 2025. For the purposes of withholding tax on salaries and public pensions, etc., the above amendments will be applied to those paid on or after January 1, 2026. But, for salaried employees, the above amendments will be applicable in the year-end adjustment for 2025 (salaries paid in 2025, the last payment of which is on or after December 1, 2025).

The revised amount of employment deduction is as under:

Gross Salary “(A)” (in JPY)	Employment Income Deduction
Gross Salary “(A)” (in JPY)	New Amount (in JPY)	Previous Amount (in JPY)
Up to 1,625,000		550,000
1,625,001 to 1,800,000	650,000	(A) X 40% – 100,000
1,800,001 to 1,900,000	650,000
1,900,001 to 3,600,000	(A) X 30% + 80,000	(A) X 30% + 80,000
3,600,001 to 6,600,000	(A) X 20% + 440,000	(A) X 20% + 440,000
6,600,001 to 8,500,000	(A) X 10% + 1,100,000	(A) X 10% + 1,100,000
8,500,001 and above	1,950,000	1,950,000

The above revision will apply for national tax purpose effective from 2025 while it will be applicable for inhabitant tax purposes from the year 2026.

Further, amendments also include special deduction for parents for college going children and modification in the threshold for spouse or dependent’s income for allowing those deduction.

Corporate taxation:
- Special Defense Corporate Tax (“SDCT”): A new special defense corporate tax of 4% will be imposed on the standard corporate tax amount (i.e., taxable base) for all corporations which are subject to corporate income taxes. For calculating the tax base, certain credits would not be allowed to be deducted from the tax base but a basic deduction of JPY 5 million will be allowed. This taxation will apply to fiscal years beginning on or after April 1, 2026. The due date for filing SDCT tax return and making tax payment would be same as the due date of corporate tax return.

Tax measures for SME:
- Extended corporate tax reduction measures for SMEs: The special tax measure for small and medium-sized enterprises (“SMEs”) have been revised and extended by two years. For fiscal years where annual taxable income exceeds JPY 1 billion, the current 15% tax rate for income up to JPY 8 million will rise to 17%. However, tax rate of 15% will be maintained where taxable income is up to JPY 1 billion. Further, group companies under the group relief system will be excluded from the scope of tax reduction measures.
- Certain tax incentives for SMEs will be extended for two more years such as SME investment incentive, SME business enhancement incentives and special measures to reduce taxable base for fixed assets tax.

International taxation:
- Global Minimum Tax (“GMT”): Japan introduced legislation on the Undertaxed Profits Rule (“UTPR”) and Qualified Domestic Minimum Top-up Tax (“QDMTT”). In order to allow affected companies sufficient time to adjust, the legislation will be applicable to fiscal years starting on or after April 1, 2026. The due date for tax return filing and payment is proposed to be 15 months (18 months in certain cases) from the end of relevant fiscal year. No filing is required if the tax amount is nil.

Implication:
Employers should take note of changes related to payroll taxes on employee income. Businesses should evaluate impact of the increase in tax burden due to special defense corporation tax effective from the year 2026. SMEs should evaluate the impact of tax rate change and extension of incentives.

Lithuania

Lithuania: Implements new Rules for EU VAT Scheme for small business.

Lithuania’s Ministry of Finance issued Order No. 568 on January 17, 2025, modifying its Value Added Tax (“VAT”) regulations. These changes, effective from January 1, 2025, incorporate the European Union’s small business scheme for cross-border transactions, as outlined in the Council Directive (“EU”) 2020/285 of February 18, 2020. Consequently, businesses established in other EU member states can now seek exemption from VAT registration in Lithuania, provided their annual turnover within Lithuania remains below the revised VAT thresholds and their total EU-wide turnover does not exceed EUR 100,000.

Implication:
Businesses should check their eligibility and evaluate benefits of new EU small business scheme.

Lithuania: Introduces significant changes in the Labor Code.

Ministry of Social Security and Labor, Lithuania reported following changes in the labor code regarding overtime work, compensation on public holidays and measures to prevent violence and harassment at the workplace, effective from January 1, 2025.

Mandatory written consent for overtime: Employers are required to obtain written consent from employees prior to assigning any overtime work. This supersedes the previous acceptance of verbal consent and reinforces the employees’ right to decline overtime.
Increased Overtime Compensation Standards: The enhanced compensation rate has been increased from 1.5 to 2 times the employees’ regular hourly rate for overtime related to night shift or working on a regular day of rest if no compensatory time off is provided.
Enhanced Overtime Pay for Night Work on Public Holidays: Employees working overtime during night-time hours (typically 10 PM to 6 AM) on public holidays are entitled to a minimum compensation of 2.5 times their regular salary.
Prohibition of violence and harassment at the workplace: The amended labor code explicitly prohibits and clarifies inappropriate behavior to be considered as violence and harassment at the workplace. It extends it to supervisors and not just limited to the employees thereby fostering respectful and safe labor relations across all levels of employment. The new provisions require the employers to implement certain measures for prevention of violence and harassment at workplace and to establish a procedure for reporting and handling of such incidents if reported. Further, to ensure a preventive approach and accountability, mandatory regular training is required to be implemented on violence and harassment provisions. The new regulation provides for fines ranging from EUR 500 to EUR 3,000 for company executives and responsible individuals in the event of failure to implement necessary preventive measures and support for the victims.

Implication:
Employers need to be aware of the changes in the Labor Code to ensure compliance with employment regulations regarding overtime work, compensation on public holidays and measures to prevent violence and harassment at the workplace.

Malaysia

Malaysia: Companies Commission of Malaysia revised qualifying criteria for private companies for audit exemption.

The Companies Commission of Malaysia (“SSM”), through the registrar, has issued Practice Directive No. 10/2024 on December 16, 2024, introducing updated qualifying criteria for audit exemption. This directive outlines that a private company may now be eligible for audit exemption if it satisfies at least two out of three specified financial thresholds, marking a significant shift in audit compliance requirements for eligible entities.

The SSM has announced that the new audit exemption criteria will be implemented in a phased manner over three years period, from 2025 to 2027. The criteria will be fully enforced for financial periods commencing on or after January 1, 2027. The phased implementation is designed to facilitate a smooth transition for private companies adapting to the new thresholds.

Phase	Financial Period	Annual Revenue (in RM)	Total Assets (in RM)	Number of Employees
Phase 1	January 1, 2025, to December 31, 2025	1,000,000	1,000,000	10
Phase 2	January 1, 2026, to December 31, 2026	2,000,000	2,000,000	20
Phase 3	January 1, 2027, onwards	3,000,000	3,000,000	30

Dormant companies in Malaysia are eligible for audit exemption under Practice Directive No. 10/2024. This applies to companies that have been inactive since incorporation or have remained dormant during both the current and immediate past financial years. Further, the audit exemption under P.D. 10/2024 is not applicable to the following entities:

Exempt private companies that have chosen to file a certificate regarding their exempt status with the Registrar under Section 260 of the Companies Act 2016;
Public companies, including those that are listed;
Private companies that are subsidiaries of public companies; and
Foreign companies.

Implication:
Company should re-examine audit applicability and take necessary steps to be compliant.

Malaysia: Malaysian tax authority released updated e-invoicing guidelines with revised deadlines and relaxation period.

On February 21, 2025, the Inland Revenue Board of Malaysia (IRBM) released updated electronic invoicing (“e-invoicing”) guidelines, introducing revised implementation timelines and relaxation measures.

Revised Implementation Deadlines
The e-invoicing rollout is now structured based on annual turnover:

Taxpayers with turnover more than RM 500,000 and up to RM 25 million: Mandatory e-invoicing will apply from July 1, 2025.
Taxpayers with turnover more than RM 150,000 and up to RM 500,000: Implementation deferred to January 1, 2026.
Taxpayers with turnover less than RM 150,000: Exempt from e-invoicing unless specific conditions apply as outlined in IRBM’s FAQs.

In case of taxpayers with turnover more than RM 25 million, the implementation is already effective, but certain relaxations are now provided.

New businesses commencing operations from 2023 to 2024 with turnover:

More than RM 500,000: Required to implement e-invoicing by July 1, 2025.
Less than RM 500,000: Implementation by January 1, 2026.

For businesses starting 2025 onwards, the implementation date is January 1, 2026, or upon commencement of operations.

Interim Relaxation Periods

In order to facilitate a smooth transition, the IRBM has introduced interim periods during which certain flexibilities are allowed:

Sr. No	Particulars	Relaxation Period
1	Taxpayers with an annual turnover or revenue of more than RM 100 million	August 1, 2024, to January 31, 2025
2	Taxpayers with an annual turnover or revenue of more than RM 25 million and up to RM 100 million	January 1, 2025, to June 30, 2025
3	Taxpayers with an annual turnover or revenue of more than RM 500,000 and up to RM 25 million	July 1, 2025, to December 31, 2025
4	Taxpayers with an annual turnover or revenue of up to RM 500,000	January 1, 2026, to June 30, 2026

During relaxation period, taxpayers are allowed to submit e-invoices on a monthly basis through consolidated invoicing.

Implication:
Businesses must assess their annual turnover to determine their mandatory e-invoicing implementation due date and ensure systems are ready ahead of deadlines. They should also utilize the interim relaxation periods for a smoother transition.

Mexico

Mexico: New Federal Data Protection Law enacted effective from March 21, 2025.

A new Federal Law for the Protection of Personal Data held by Private Parties, 2025 (“DPL” of 2025) was published in the Official Gazette of the Federation on March 20, 2025. The provisions of DPL 2025 are effective from March 21, 2025, and the earlier DPL of 2010 data privacy law is repealed.

Key features of the law are as under:

Scope expanded: The scope of the law is expanded to include individuals who undertake processing of the personal data and not merely data controllers or persons processing data on behalf of them as per the earlier provisions.
Creation of Register: The provisions of the Law mandates creation of a National Registry of Data Controllers, requiring registration of all individuals and legal entities (i.e. controllers and processors) in the private sector that handle personal data. This registry will include key information such as the types of data processed, purposes of processing, data retention periods, and data transfers.
Data principles: The Law has incorporated principles relating to data minimization, accountability and purpose limitation similar to the EU General Data Protection Regulations (“GDPR”).
Confidentiality: The parties relating to processing of personal data need to maintain confidentiality throughout the process and the companies need to impart necessary trainings, adopt appropriate contractual clauses in the contracts to ensure the confidentiality of personal data.
Modification in content of privacy notice: The provisions amended the basic content required to be given in the privacy notice which now must include the identity and address of the controller, the personal data processed with express mention of sensitive data, the purposes of the processing, indicating those requiring the consent, the means available to limit the use or disclosure of the data, and the site where the comprehensive full notice may be viewed.
Rights of data subjects: Rights of the data subjects such as right of access, rectification, cancellation and objection are now extended to automated decision-making processes.
Creation of specialized courts: The law emphasizes on creation of specialized federal courts for handling cases of data protection.
Change of Regulatory Authority: As per the new provisions of the Law, a decentralized body under the Secretariat of Anti-Corruption and Governance replaces the National Institute for Transparency, Access to information and Personal data protection (“INAI”) as the regulatory authority.

Implication:
Companies need to make note of the latest developments and accordingly revise their internal policies to protect and safeguard the personal data.

Philippines

Philippines: Increase in the contribution bases and rate of social security effective from January 1, 2025.

The Philippine Social Security System on January 7, 2025, announced an increase in the social security contribution rate and the minimum and maximum contribution caps effective from January 1, 2025.

the minimum monthly salary credit (“MSC”) is increased to PHP 5,000 from PHP 4,000; and
the maximum monthly salary credit increased to PHP 35,000 from PHP 30,000; and
the social security contribution rate increased to 15% from 14%.

The Monthly Salary Credit (“MSC”) is a critical component of the Social Security System (“SSS”) in the Philippines, serving as the basis for calculating contributions and benefits for members.

Poland

Poland: Introduces new supplementary maternity leave for parents of premature and hospitalized newborns, effective from March 19, 2025.

On March 19, 2025, Poland will implement the provisions of the “Act of 6 December 2024” amending the Labor Code and certain other acts (Journal of Laws of 2024, item 1871), introducing additional/ supplementary maternity leave to support parents of prematurely born children and newborns requiring hospitalization.

Currently, under the Polish Labor Code, maternity leave consists of 20 weeks for the birth of one child, with the option to extend through parental leave (up to 41 or 43 weeks in total, depending on the number of children born). However, until now, there has been no dedicated provision addressing the specific needs of parents whose children are born prematurely or require extended hospitalization after birth.

The new regulations are effective from March 19, 2025, which are as follows:

The new parental right applies to mothers, fathers, legal guardians, adoptive parents, and foster families.
The duration of the supplementary leave can be up to 8 or 15 weeks based on the child’s medical condition, including gestational age at birth, birth weight, and the length of the hospital stay.
The additional maternity leave must be taken as a single, continuous period immediately following the basic maternity leave and will be granted at the employee’s request, allowing parents to decide whether to make use of this entitlement.
During this leave, parents will receive a maternity benefit amounting to 100% of the benefit base, which will be paid by Social Insurance Institution (Zakład Ubezpieczeń Społecznych –ZUS), as is the case with standard maternity benefits in Poland.
In line with amended Labor Code provisions, employers in Poland must update employee documentation practices. They will be required to accept and retain in the employee’s personal files, supplementary maternity leave applications which are required to be submitted at least 21 days before the end of basic leave. Employers must also ensure proper use of updated insurance codes for ZUS reporting and benefit settlements.

Implication:
Employers must update their documentation practices to accommodate supplementary maternity leave applications, ensure proper record-keeping, and implement new insurance codes for ZUS reporting starting March 19, 2025.

Serbia

Serbia: Social security contribution bases for the year 2025 published.

The government of Serbia has published the minimum and maximum social security contribution basis amounts for 2025. The minimum monthly contribution basis is RSD 45,950 (previously RSD 40,143) and maximum monthly contribution basis is RSD 573,470 (previously RSD 656,425).

Implication:
Employers should consider the revised bases for calculating social security while processing payrolls.

Serbia: New law on central register of beneficial owners enacted.

Serbia has enacted the Law on the Central Register of Beneficial Owners, which officially came into force on March 14, 2025. The most provisions will become applicable after an 18-month transition period while the existing entities must comply it by November 13, 2026, i.e., 60 days from the applicability date.

Key changes introduced by the Law:

The registration deadline is extended to 30 days from the date a registrable event occurs.
Entities must upload supporting documents used to determine beneficial ownership, including ID copies for foreign owners.
An annual review and verification of beneficial ownership data is now mandatory.
The Business Registers Agency will publish a list of non-compliant entities on its website.
Penalties for concealing beneficial ownership information have been increased to 6 months to 5 years of imprisonment.
Entities and responsible individuals may face activity bans for up to 3 years for non-compliance.
There is an obligation to retain beneficial ownership documentation for 5 years after dissolution, with fines ranging from RSD 50,000 to RSD 150,000 for failure to do so. This provision is effective with immediate effect.

Implication:
Businesses should note the obligation about registration of beneficial owners and comply with it within the timeline to avoid penal consequences.

Singapore

Singapore: Budget 2025 – Highlights.

On February 18, 2025, the Prime Minister and Finance Minister, Mr. Lawrence Wong presented the Budget for the year 2025 which subsequently received Presidential assent on March 13, 2025. The key changes are as under:

Corporates/ Businesses

Corporate Income Tax (“CIT”) Rate:
There are no changes in the corporate tax rates. The standard corporate tax rate in Singapore is 17%. The tax year followed in Singapore is calendar year. The corporate tax is assessed on a preceding year basis (i.e., “basis period”). Hence, the income earned in the basis period is assessed to tax in subsequent year (i.e., year of assessment “YA”).

CIT Rebate:
A CIT rebate of 50% of tax payable is granted for the YA 2025, which mirrors the CIT rebate allowed in YA 2024. Additionally, the companies meeting the “local employee condition” (i.e., contributing to Central Provident Fund “CPF” for at least one local employee in 2024 viz. Singapore citizen or permanent resident, subject to certain exclusions), can receive a minimum benefit of SGD 2,000 in cash, termed as “CIT Rebate Cash Grant”. Total benefit for each company considering tax rebate and cash grant is capped at SGD 40,000.

Double Tax Deduction for Internationalisation (DTDi) Scheme:
The DTDi Scheme is extended until December 31, 2030, which was originally planned to be lapsed by December 31, 2025. The scheme allows businesses a tax deduction of 200% on qualifying specified international expenses viz. market expansion and investment development expenses, etc. By the extension of the scheme, the Singapore Government ensures continued support for companies investing in overseas ventures, expanding its global footprint and drive towards the economic growth.

Mergers and Acquisitions (“M&A”) Scheme:
The M&A Scheme is extended until December 31, 2030, which was planned to be lapsed by December 31, 2025. The M&A scheme, first introduced in Budget 2010 with certain enhancements made in subsequent years, aims to make acquisitions more affordable by reducing the tax burden on acquiring companies to support the businesses in their growth strategies and the overall economy. Under the scheme, companies can claim M&A allowance/ deduction over 5 years calculated at 25% of the value of all qualifying acquisitions per YA capped at SGD 40 million (i.e., allowance/ deduction of SGD 10 million), and 200% tax deduction on transaction costs incurred on qualifying acquisitions.

Tax deduction for innovation activities:
A new 100% tax deduction is introduced for payments made by companies under an approved Cost-Sharing Agreement (CSA) for innovation activities effective from February 19, 2025. This will enhance the Singapore’s competitiveness for innovation and technology.

Individuals/ Employees
The tax year followed in Singapore for individuals is the calendar year. An individual’s income from a previous calendar year is assessed to tax in the following calendar year (i.e., year of assessment, “YA”).

The Budget 2022 introduced two new income brackets, viz. 23% and 24%, which took effect from YA 2024. In the Budget 2025, there are no changes made in the personal income tax rates. The personal income tax rates applicable to residents from YA 2024 onwards are as follows:

Annual Taxable Income (In SGD)	Income Tax Rate
Income Tax Slabs/ Rates From the year of assessment (YA) 2024 onwards
Up to 20,000	Nil
20,001 to 30,000	2.00%
30,001 to 40,000	3.50%
40,001 to 80,000	7.00%
80,001 to 1,20,000	11.50%
1,20,001 to 1,60,000	15.00%
1,60,001 to 2,00,000	18.00%
2,00,001 to 2,40,000	19.00%
2,40,001 to 2,80,000	19.50%
2,80,001 to 3,20,000	20.00%
3,20,001 to 5,00,000	22.00%
5,00,001 to 10,00,000	23.00%
Above 10,00,000	24.00%

The personal income tax rebate is granted for Singaporean residents for YA 2025 up to 60% of tax payable with the maximum limit of SGD 200 as a part of SG60 package.

Others
- Introduction of new Enterprise Compute Initiative, for which SGD 150 million will be set aside. Under the initiative, eligible businesses will be partnered with major cloud service providers to access artificial intelligence (AI) tools and computing power, as also to avail consultancy services, which will help them in their transformation journey.
- Global Founder Programme will be launched later this year which will encourage global founders to anchor and grow more new ventures in Singapore.
- The budget includes measures to support businesses in their sustainability efforts, such as grants and incentives for adopting green technologies. Additionally, SGD 5 billion has been added to the Future Energy Fund to foster the development of clean energy solutions.

Please refer to the detailed article on Singapore budget on our website for more information.

Implication:
Individuals and companies should take a note of the budgetary changes and implement the new measures as applicable.

South Africa

South Africa: South Africa enacts Global Minimum Tax Law, aligning with OECD standards.

South Africa has formally joined the ranks of countries implementing the global minimum tax regime, following the recent enactment of the Global Minimum Tax Act, 2024. On December 24, 2024, the President signed the legislation into law, and it was published in Government Gazette No. 51830. Subsequently, the Global Minimum Tax Administration Act, 2024 was assented to on January 7, 2025, and published in Government Gazette No. 51884 on January 9, 2025, to provide administrative framework necessary for implementation of Global Minimum Tax Act, 2024.

The provisions introduce 15% global minimum tax for companies, that are part of multinational and domestic groups with consolidated annual revenue of at least EUR 750 million in two of the tax year preceding the reporting year. The law will apply retrospectively for the tax year beginning on or after January 1, 2024.

The provisions include –

Income Inclusion Rule (“IIR”): This is payable by the South African parent companies (i.e., Ultimate parent entity of the group) with respect to their foreign low-tax constituent/ member companies.
Domestic Minimum Top-up Tax (“DMTT”): This domestic top up tax of 15% applies to qualifying companies and permanent establishments (i.e., constituent/ member companies of the group) in South Africa with an effective tax rate below 15%.

Further, qualifying MNEs operating in South Africa will be required to submit a GloBE Information Return, detailing income, taxes paid, and any applicable top-up taxes. The GloBE Information Return must be filed within 15 months after the end of the fiscal year. In case of the first fiscal year in which the MNE group becomes subject to the top-up tax, the deadline is extended to 18 months after the end of that fiscal year. The above requirement will not apply when such return is submitted by the ultimate parent entity or other designated entity in the jurisdiction with which South Africa has qualifying arrangement for automatic exchange of such return. In such cases, the domestic constituent entity must notify the Commissioner of the identity and jurisdiction of the entity responsible for filing the GloBE Information Return.

Implication:
Businesses who are liable for global minimum tax compliance should take note of the above development and arrange to comply with the same.

South Africa: Amendments to the Companies Act to be effective from December 27, 2024.

South Africa has enacted key amendments to its Companies Act, that will take effect from December 27, 2024.

The key provisions which have already become effective are as under:

Section 16: Changes to a company’s Memorandum of Incorporation (“MOI”) will now take effect 10 business days after its submission to the Companies and Intellectual Property Commission (“CIPC”), unless earlier endorsed or rejected.
Section 48: Shareholder approval is mandatory for share buybacks involving directors or their related parties.
Section 61 and 72: Public companies are required to appoint a social and ethics committee and provide its report and remuneration report at their annual general meeting. Companies seeking exemption from forming a social and ethics Committee must publicly declare their intent. exemptions will also be available to subsidiaries covered by the holding company’s committee.
Section 90: The amendment clarifies that the companies subject to audits must appoint an auditor at their first relevant shareholders’ meeting and annually after that.
Section 135: Amounts owed to landlord post-business rescue are now included as post-commencement finance, impacting creditor prioritization. This section deals with business rescue proceedings for companies facing financial difficulties.

Additionally, the following provisions have not yet been implemented but will be implemented in future:

Section 25 & 26: Companies will need to disclose the location of company records and it also will provide expanded access to key documents, including registers of directors and beneficial ownership.
Section 30: Annual financial statements will include detailed remuneration disclosures for each director and prescribed officers, along with separate disclosure for remuneration related to group services.
Section 38A: Any unauthorized share issuance will have to be validated within 60 business days, or it will be deemed void.

Implication:
Companies should review the amendments, analyze the impact of them and make necessary changes to their policies and procedures.

South Africa: Minimum hourly wage increased to ZAR 28.79 per hour effective from March 1, 2025.

Effective from March 1, 2025, the Employment and Labor Ministry of South Africa increased the minimum wages by 4.38% to ZAR 28.79 per hour (previously ZAR 27.58).

South Africa: SARS updates interest rate tables: reductions across all categories.

The South African Revenue Services (“SARS”) has published revised interest rate tables as under:

Table	Description	New Rate	Previous Rate	Effective Date
Table 1	Interest rates chargeable on outstanding taxes, duties, and levies, and interest payable on refunds following appeals or certain delayed refunds.	11.25%	11.50%	March 1, 2025
Table 2	Interest rates on credit amounts (overpayment of provisional tax).%	7.25%	7.50%	March 1, 2025
Table 3	Income tax rates for interest-free or low-interest loans	8.50%	8.75%	February 1, 2025

Implication:
Businesses should take note of the reduction in the interest rates.

South Africa: Government proposes two-stage VAT increase, starting May 2025.

On March 12, 2025, during the presentation of the national annual budget, South Africa’s Finance Minister announced a two-phase increase in the Value-Added Tax (“VAT”) rate, marking the first rise since 2018. The VAT rate will go up by 0.5% to 15.5% effective May 1, 2025, followed by an additional 0.5% increase to 16% on April 1, 2026.

The proposed changes remain subject to approval by the Parliament. However, under the South African VAT Act, the initial rate hike becomes temporarily effective from the date of announcement in the budget and stays in force for 12 months, unless overturned by Parliament.

Implication:
Businesses should monitor developments regarding parliament approvals for increase in VAT rates and keep their systems ready for upcoming VAT rate change from May 1, 2025, to ensure a smooth transition.

South Africa: Revised annual earnings threshold to be effective from April 1, 2025.

South Africa has revised the annual earnings threshold for the year 2025 from ZAR 254,371.67 to ZAR 261,748.45 effective from April 1, 2025.

Employees earning less than annual earning threshold enjoy protection under Basic Conditions of Employment Act (“BCEA”), Labor Relations Act and Employment Equity Act. Certain provisions of BCEA regarding ordinary hours of work, overtime pay rates, meal intervals, rest period, night work, etc. apply only to employees earning below annual earning threshold. Further, under the Labor Relations Act, a temporary employee earning below the annual earning threshold may be considered as employed for indefinite period if they work for more than three months with the same employer subject to fulfilment of certain conditions.

Implication:
Employers should evaluate if any of their employees qualify for benefits under various labor laws mentioned above due to increase in earnings threshold and take necessary actions for ensuring compliance.

South Africa: Revamping of digital VAT rules for non-resident providers from April 2025.

South Africa National Treasury announced amendments to VAT regulations on March 14, 2025, which took effect on April 1, 2025. Key changes include:

The definition of the term ‘electronic services’ amended to exclude cases of supplies by non-residents exclusively to VAT registered persons. Thus, Foreign digital service providers supplying only VAT-registered businesses in South Africa are no longer required to register for VAT.
In these cases, the reverse charge mechanism applies, making the South African business responsible for VAT reporting.
However, if a provider supplies both VAT-registered businesses and non-registered consumers, they must still register and charge VAT including for B2B transactions.
Intermediaries rule is amended to allow registered foreign suppliers to use intermediaries to manage their VAT obligations.
Definitions and exclusions related to digital services and intergroup transactions will be refined to address potential avoidance strategies.

Implication:
The above changes aim to reduce the compliance burden on foreign suppliers providing digital services to users in South Africa. Non-resident suppliers should analyze the provisions to assess impact for compliance requirements.

South Africa: Announces revision in Employment Tax Incentive scheme from April 2025

Effective April 1, 2025, South Africa implemented changes to its Employment Tax Incentive (“ETI”) programme, aimed at encouraging youth employment. The ETI reduces the cost of hiring young workers by allowing eligible employers to retain a portion of Pay-As-You-Earn (PAYE) tax for the first 24 months of employment. The incentive lets employers lower their PAYE contributions without impacting employees’ take-home pay, providing financial relief while promoting job creation among the country’s youth.

Below are the proposed changes in Employment tax incentives:

Proposed			Current
Monthly Remuneration	Formula First 12 Months	Formula Second 12 Months	Monthly Remuneration	Formula First 12 Months	Formula Second 12 Months
Upto ZAR 2,499.99	60% of monthly remuneration	30% of monthly remuneration	Upto ZAR 1,999.99	75% of monthly remuneration	37.5% of monthly remuneration
From ZAR 2,500 to ZAR 5,499.99	ZAR 1,500	ZAR 750	From ZAR 2,000 to ZAR 4,499.99	ZAR 1,500	ZAR 750
ZAR 5,500 to ZAR 7,499.99	ZAR 1,500 – (75% x (monthly remuneration — ZAR 5,500))	ZAR 750 – (37.5% x (monthly remuneration — ZAR 5,500))	ZAR 4,500 to ZAR 6,499.99	ZAR 1,500 – (75% x (monthly remuneration — ZAR 4,500))	ZAR 750 – (37.5% x (monthly remuneration — ZAR 4,500))

Implication:
Employers hiring workers should review their payroll processes to ensure they can effectively claim ETI benefits under the updated rules from April 1, 2025.

South Korea

South Korea: PIPA amended to appoint local representative effective from October 2, 2025

On April 1, 2025, South Korea’s president signed an amendment to the Personal Information Protection Act (“PIPA”), pursuant to the approval from the National Assembly on March 13, 2025. The new amendment requires the foreign companies handling personal data to appoint its local entity as a local representative, while monitoring activities from their headquarters. Domestic companies must also supervise their local representatives and update their data processing policies accordingly. The amendment will take effect on October 2, 2025.

Earlier, South Korea’s PIPA required offshore entities in Korea meeting certain thresholds, to appoint a local representative to handle key data protection responsibilities. These included acting as a chief privacy officer, managing data breach notifications and reports, and responding to requests from the Personal Information Protection Commission (“PIPC”) in potential violation cases.

The amendment to PIPA introduces clearer obligations for foreign businesses (“data controllers”) operating in Korea. Under the new rules, if a foreign company has a local entity in Korea, it must appoint that entity as its local representative, rather than designating an unrelated third-party. The foreign business is also required to manage and supervise the local representative in the performance of their duties. Additionally, the company must disclose the representative’s name, address, phone number, and email address in its privacy policy to ensure transparency. The amendment further clarifies the scope of the local representative’s responsibilities, specifying that their role is to handle complaints and address damages related to the processing of personal information, rather than serving in a broad or undefined capacity similar to a chief privacy officer.

Implication:
Foreign businesses should take note of new requirement to appoint their local entities as a representative and supervise such representative under PIPA and ensure compliance with the amended PIPA.

South Korea: New National Health Insurance Contribution Limits announced effective from January 1, 2025

The National Health Insurance (“NHI”) contribution thresholds have been revised with effect from January 1, 2025.

The following are the revised thresholds/ceilings:

maximum monthly salary limit, which is the maximum amount used as basis to calculate the insurance premium, is increased from KRW 119,625,106 to KRW 127,056,982;
maximum monthly premium, the maximum amount both employer and employee together contribute toward the insurance, is increased from KRW 8,481,420 to KRW 9,008,340.

However, minimum monthly salary limit and premium amount remains unchanged at KRW 279,266 and KRW 19,780, respectively.

Implication:
Employer should update their payroll processes and systems in light of changes in salary ceilings and premium.

Turkey

Turkey: Severance pay ceiling increased to TRY 46,655.43 for first half of 2025

On January 6, 2025, Turkey’s Ministry of Treasury and Finance announced an update to the severance pay ceiling via an official circular. The new cap, effective from January 1, 2025, to June 30, 2025, has been increased and set at TRY 46,655.43 (previously TRY 41,828.42) for the first half of the year 2025.

Under Turkish labor law, severance payments must be calculated using this upper limit if an employee’s gross monthly salary exceeds it. Those earning below the ceiling will continue to receive severance based on their actual salary. Severance pay refers to the compensation an employer in Turkey is legally required to pay an employee upon termination, provided the employee meets certain eligibility criteria.

Implication:
Employers should take note of revised salary ceiling for severance calculations for high-earning employees and ensure payroll systems reflect the updated threshold.

Turkey: Social security contribution basis increased from January 1, 2025.

Effective from January 1, 2025, the Turkish Ministry of Labor and Social Security has raised minimum and maximum monthly basis for calculation of social security contribution. The minimum monthly basis is increased to TRY 26,005.50 (previously TRY 20,002.50) and maximum monthly limit is raised to TRY 195,041.40 (previously TRY 150,018.90). These bases are used for the computation of both employee and employer portion of social security contributions.

Implication:
Employers must apply the revised social security basis and ensure payroll systems reflect the updated threshold.

Turkey: Employer premium support rate decreased, but manufacturing sector retains extended relief

Effective February 1, 2025, Turkey has revised its employer premium support for disability, old age, and death insurance contributions, reducing the rate from 5% to 4% except for manufacturing sector. This change increases the effective employer contribution rate from 15.75% to 16.75%, bringing the overall standard contribution rate to 20.75%. The employer premium support reduces the social security contribution liability of the employer thereby providing them incentive for employment.

Implication:
Employers except from the manufacturing sector should prepare for a higher contribution burden beginning February 2025 due to the reduced support rate.

Turkey: Turkey raises threshold for minimum input VAT refund claims.

The Turkish Revenue Administration has announced the issuance of Presidential Decision No. 9582, published in the Official Gazette on March 15, 2025. The decision raises the minimum threshold for input Value Added Tax (“VAT”) refund claims from TRY 2,000 to TRY 10,000. This new threshold will apply to transactions conducted on or after April 1, 2025.

Implication:
Businesses and taxpayers should review their VAT claims in light of the increased threshold.

United Kingdom

United Kingdom: The online service of filing accounts and company tax return to be discontinued from March 31, 2026.

The HM Revenue and Customs (“HMRC”) released a guidance on March 5, 2025, informing that the joint online service of filing company accounts and company tax returns with Companies House and HMRC, respectively, will be discontinued effective from March 31, 2026. The decision to discontinue this is due to the failure to align with modern digital standards, enhanced corporation tax requirements, and recent changes to UK company law under the Economic Crime and Corporate Transparency Act (“ECCT Act”).

From April 1, 2026, companies can file their annual accounts with Companies House through third party software, web services or paper filing. Further, companies can file Company Tax Return with HMRC, exclusively through third party software. HMRC has issued a 12-month notice period to give companies sufficient time to identify suitable third-party software providers that meet the requirements of both Companies House and HMRC.

Companies will still have the option to amend previously submitted returns and accounts, even after the online service is discontinued. Tax returns for earlier years can be filed using commercial software, by submitting a paper return, or through an agent. Annual accounts can be submitted either via commercial software or in paper form.

Implication:
Companies should take note of the change and make the necessary arrangements in advance.

United Kingdom: Finance Bill passed to give effect to Autumn Budget 2024 tax proposals; Spring Statement presented before the Parliament.

Both, the Finance Act, 2025 and National Insurance Contributions (“Secondary Class 1 Contributions”) Act 2025 have been enacted and have received Royal Assent on March 20, 2025, and April 3, 2025, respectively, implementing 2024 Autumn Budget proposals. Separately, on March 26, 2025, the Chancellor of the Exchequer, Rachel Reeves, presented the Spring Statement before the UK Parliament.

The key highlights are as follows:

Finance Act 2025 to give effect to Autumn budget proposals:
- The headline corporate tax rate is set at 25% for the year 2026, keeping small profit tax rate and the marginal tax rate unchanged.
- The remittance-based taxation applicable to non-domiciled individuals is replaced with a new internationally competitive residence-based regime from April 6, 2025. The law also provides for transitionary arrangements.
- The Pillar 2 Undertaxed Profits Rule (“UTPR”) are effective for accounting periods beginning on or after December 31, 2024. The law also makes certain amendments regarding provisions related to Multinational Top-up Tax (“MTT”) and Domestic Top-up Tax (“DTT”) which are effective from March 14, 2024.

National Insurance Contributions (Secondary Class 1 Contributions) Act for giving effect to Autumn Budget proposals:
- Starting from April 6, 2025, the employer’s national insurance (“NI”) contribution rate is increased from 13.8% to 15% and the secondary threshold i.e., per-employee threshold at which employers become liable to pay NI contribution, is reduced from GBP 9,100 to GBP 5,000. The following table summarizes the changes in the contribution rates:

Timeline	Rates for Employer	Main rates for Employee (below Upper Earnings Limit)	Additional rate for Employee (above Upper Earnings Limit)
Prior to April 6, 2025	13.80%	8%	2%
Effective from April 6, 2025 (announced in Autumn statement 2024)	15%	8%	2%

- The employment allowance is increased from GBP 5,000 to GBP 10,500.

Spring Statement 2025 proposals:
- Spring Statement does not introduce any major revisions to the corporate tax system or tax policies affecting individuals.
- The Spring Statement announces various measures relating to Making Tax Digital (“MTD”) viz. expanding MTD for Income Tax to sole traders and landlords earning over GBP 20,000 from April 2028, exemptions or deferrals for certain taxpayers, improvements to end-of-year processes using MTD-compatible software, and the finalization of the policy framework for MTD and penalty reform. A legislation related to MTD is expected to be enacted before April 2026, the date when compliance with the new requirements will become mandatory.
- From April 2025, taxpayers that are part of the MTD scheme will be charged 3% of the outstanding tax where their tax is overdue by 15 days, plus another 3% if it remains unpaid at 30 days. Additional penalty of 10% will apply when tax remains overdue for 31 days or more.
- Spring Statement announces plan to increase efforts to liquidate tax debt of HMRC (HM Revenue and Customs). The HMRC will resume its practice of “direct recovery” which means collecting unpaid taxes directly from individuals and companies who can afford to pay but deliberately avoid doing so. Additionally, the government plans to look into ways to automate the collection of lower-value tax debts, making the process more efficient and reducing the need for manual intervention. HMRC will expand its counter-fraud initiatives such as prosecution against tax fraudsters, rewarding informant to target non-compliance, etc.
- Starting from summer 2025, employed individuals who need to pay the high-income child benefit Charge (“HICBC”) can use a new digital service to report their family’s Child Benefit payments. They will also have the option to pay the HICBC directly through the PAYE (“Pay As You Earn”) system, without needing to register for self-assessment.
- The Government proposes to launch consultation for revised system of advance clearance in R&D tax relief scheme to provide greater tax certainty. Further, the businesses would be able to obtain certainty on transfer pricing aspects of cost contribution agreement under UK advance pricing programme.

Please refer to the detailed article on Autumn Statement 2024 and Spring Statement 2025 on our website for more information.

Implication:
Employers should take note of increase in NI rates and reduction in secondary threshold and evaluate the impact on their profitability. Small business should take advantage of employment allowance increase.

United Kingdom: New company size thresholds applicable effective from April 6, 2025

UK publishes the Companies (Accounts and Reports) (Amendment and Transitional Provision) Regulations 2024 (SI 2024/1303) to introduce various amendments to the company law, including revisions to company size thresholds, changes to reporting requirements, and updates to the Directors’ Report.

Key highlights of the amendments:

Revision in the company size thresholds: The company size thresholds for micro, small and medium-sized entities has been revised effective from April 6, 2025.

The following table outlines the changes in the threshold limits:

Category for Entities	New / Revised Thresholds	Previous Thresholds
Micro
Turnover (in GBP) not more than	1 million	632,000
Total Assets (in GBP) not more than	500,000	316,000
Average Number of Employees not more than	10	10
Small
Turnover (in GBP) not more than	15 million	10.2 million
Total Assets (in GBP) not more than	7.5 million	5.1 million
Average Number of Employees not more than	50	50
Medium
Turnover (in GBP) not more than	54 million	36 million
Total Assets (in GBP) not more than	27 millio	18 millio
Average Number of Employees not more than	250	250

An entity qualifies as micro, small or medium, if it meets any two out of three criteria mentioned above.

Companies that move into a smaller size category such as small or micro entities, would have less stringent reporting obligations as compared to earlier. For those qualifying as small entities, this includes exemptions from statutory audits (depending on group membership) and the requirement to produce a strategic report. Companies classified as micro entities are also exempt from preparing a Directors’ Report. These changes can significantly ease the compliance and administrative workload.
Introduction of the transitional rule: A transitional provision ensures that if the updated size criteria apply in the current financial year, they are treated as if they were also applicable in the previous year. As a result, companies can benefit from the revised thresholds in the accounting period beginning on or after April 6, 2025, even if under old rules they were not entitled to reduced reporting requirements.
Removal of the outdated and unnecessary requirements from the Director’s Report: To simplify reporting requirements, certain information will no longer be required to be included in the Director’s Report such as financial instruments use, post-year-end events, future business plans, R&D activities, overseas branches, disability employment practices, and stakeholder engagement.

Implication:
Companies should take note the revised thresholds and reassess their situation and its impact on the reporting and compliance obligations.

United Kingdom: The Income Tax (“Indexation of Blind Person’s Allowance and Married Couple’s Allowance”) Order 2025

The Married Couples Allowance and Blind Person’s Allowance is increased vide the Income Tax (“Indexation of Blind Person’s Allowance and Married Couple’s Allowance”) Order 2025, issued on January 21, 2025.

Section 57(6) of the Income Tax Act 2007 requires the Treasury to annually review and adjust certain tax allowances, such as the blind person’s allowance, in line with inflation, typically measured by the Consumer Price Index (“CPI”).

The allowances are increased as follows:

blind person’s allowance from GBP 3,070 to GBP 3,130;
married couple’s allowance from GBP 11,080 to GBP 11,270; and
the adjusted net income limit for married couple’s allowance from GBP 37,000 to GBP 37,700.

Implication:
Employers must ensure that their payroll systems are updated to reflect the revised allowances while making adjustment to the take home salary of employees.

Australia