Global Updates – January 2026

The Revenue and Customs Control Agency (“ARCA”) has revised thresholds for various transfer pricing filings vide General Resolution (“ARCA”) 5798/2025 which was published in the Official Gazette of the Argentine Republic on December 16, 2025. The Resolution amended Income Tax Law Regulatory Decree and will apply to financial years starting on or after October 29, 2025.

Key changes are as under:

General regime (GR 4717)

Transfer Pricing Study would be applicable in cases where total transactions with foreign related parties exceed ARS 150 million (earlier ARS 3 million), or individual transactions exceed ARS 15 million (earlier ARS 300,000). The requirement to file transfer pricing study is also applicable where transactions carried out with unrelated parties in non-cooperative jurisdictions or low or no tax jurisdictions exceed the above threshold for aggregate or individual operations.
Master File is applicable to multinational enterprise (MNE) groups with consolidated annual revenue above ARS 100 billion and transactions with foreign related parties exceeding ARS 150 million (earlier ARS 3 million) at group level or ARS 15 million (earlier ARS 300,000) per transaction.
Form 2668 is required to be filed where import and/or export of goods with independent parties exceeds ARS 500 million (earlier ARS 10 million). It is also applicable when transactions with foreign related parties exceed ARS 150 million at group level or ARS 15 million per transaction or transactions with unrelated entities in non-cooperative or no/low tax jurisdictions exceed ARS 500 million on aggregate basis or ARS 15 million on individual transaction basis.
The resolution also introduces Form 2673 for the filing of the Master File. This allows the “reporting party” to submit the Master File on behalf of the local group, while other Argentine entities may be included as “informed parties.” Informed parties must submit Form 2673 identifying the reporting party but are not required to resubmit the Master File. This requirement applies immediately to the filing made after the issue of Resolution regardless of the year to which it relates.

Simplified Regime (GR 5010)

The simplified information regime applies to entities engaged in import and/or export operations with independent parties within certain range. The range for such operations is revised to transactions above ARS 500 million but below ARS 3 billion as against the earlier threshold of ARS 10 million but below ARS 60 million. Where transactions with foreign related parties exceed ARS 150 million on aggregate basis or ARS 15 million on individual transaction basis, ARCA may require submission of a full Transfer Pricing Report.

Implication:
Businesses should reassess their transfer pricing documentation and reporting obligations in light of the revised thresholds.

Australia

Australia: Parliament passed law to require employers to make superannuation guarantee payment within 7 working days.

On November 04, 2025, the Australian Parliament passed the Treasury Laws Amendment (Payday Superannuation) Bill 2025 and the Superannuation Guarantee Charge Amendment Bill which received Royal Assent on November 06, 2025. The reforms are known as the “Payday Super” reform package.

From July 01,2026, employers will be required to pay superannuation guarantee (“SG”) contributions within seven business days of each employee’s payday, as against the current system of quarterly payment. A “payday” means the date on which qualifying earnings are paid, including salary and wages, salary sacrifice super amounts, and other amounts currently treated as ordinary time earnings (“OTE”). The clearing house arrangement for small businesses through Australian Taxation office’s Small Business Superannuation Clearing House will discontinue from July 1, 2026.

The reforms would significantly reshape the Superannuation Guarantee Charge (“SGC”) regime. The timing of the charge will align with the new payday payment model and administrative uplift and choice-loading rules will be revised.

Implication:
Employers should update their payroll processes, plan cash flows in light of requirement of frequent SG payments. A failure to comply can lead to heavy penalties.

Australia : Government plans to introduce crypto asset tax reporting from 2027.

The Australian Government published Mid-year Economic and Fiscal Outlook on December 17, 2025, confirming that the OECD Crypto-Asset Reporting Framework (“CARF”) will be implemented in Australia from 2027. The first exchanges of information with foreign tax authorities will take place in 2028.

The following are the key takeaways:

Australian Crypto asset provider will have to report to the Australian Tax Office (“ATO”) information on crypto assets held by foreign tax residents and entities controlled by foreign tax-resident persons. This information will then be exchanged with the relevant jurisdictions.
Domestic crypto tax reporting framework will also be introduced, commencing in 2027, with reporting to the ATO beginning in 2028.
The above measures are expected to improve transparency and tax revenue.

Implication:
Crypto-asset service providers should monitor developments with respect to upcoming regulations and prepare themselves for additional compliance.

Canada

Canada: Ontario introduces new job posting requirements starting from January 1, 2026

Effective January 1, 2026, Ontario employers with 25 or more employees will need to follow new rules under the Ontario Employment Standards Act, 2000 (“ESA”) while advertising job openings. These changes aim to improve transparency, fairness, and accessibility in hiring.

Key requirements include:

Compensation disclosure: Job postings must list the expected salary or salary range. Difference between lower and upper value of the range cannot exceed CAD 50,000. This requirement does not apply to positions where the top of the range exceeds CAD 200,000 per year. For this purpose, “compensation” includes all forms of wages defined under the ESA.
No Canadian experience requirement: Employers cannot mandate Canadian experience in job postings or associated application forms.
AI use disclosure: If artificial intelligence (AI) is used to screen, assess, or select applicants, this must be clearly disclosed in the job posting.
Vacancy status: Every job posting must indicate whether it is for a current vacancy.
Post-interview notification: Employers must inform the interviewed candidates about whether a hiring decision has been made within 45 days of their interview (or last interview if multiple rounds occur). Notifications can be delivered in person, in writing, or electronically.

The above requirements are not applicable in case of general campaign, which is not for a specific position, internal posting for existing employees or posting where work will be performed outside Ontario.

Implication:
Ontario employers with 25 or more employees must ensure compliance with the new requirements relating to job postings and notify interviewed candidates about the outcome within 45 days.

Canada: British Columbia has introduced 27-week job-protected leave for serious illness or injury.

On October 20, 2025, the Government of British Columbia introduced Bill 30, the Employment Standards (Serious Illness or Injury Leave) Amendment Act, 2025. The legislation came into force on November 27, 2025, creating a new extended, unpaid, job-protected leave for employees who are unable to work due to a serious personal illness or injury. Under the new rules, eligible employees may take up to 27 weeks of leave within a 52-week period to support longer-term treatment and recovery. Similar leave is available under the federal Employment Insurance sickness benefit program and laws of some other states.

To access this leave, employees must provide a medical certificate confirming they are unable to work and outlining the expected start and end dates of the leave. The leave must be taken in minimum one-week increments and may be used intermittently within the same 52-week period if the full entitlement is not taken at once. If an employee returns to work but later becomes unable to continue working due to the same medical condition, the leave may be resumed without providing a new medical certificate, provided the 27-week entitlement has not been fully used.

In addition, effective November 12, 2025, new rules governing short-term sick leave under the BC Employment Standards Act and its regulations came into force. Employers are no longer permitted to request a medical note for employee’s first two health-related absences of five consecutive days or fewer in a calendar year. A medical note may still be required in certain situations such as if the employee is absent three or more times in the year, if the absence exceeds five consecutive days, or if medical information is reasonably needed to assess fitness to return to work or in case of the need for workplace accommodation. These changes are intended to reduce unnecessary strain on the healthcare system and help limit the spread of illness.

Implication:
Employers must update leave and attendance policies to comply with the new 27-week job-protected serious illness or injury leave and changes related to short term sick leave.

Canada: 2025 federal budget: Highlights.

On November 4, 2025, Canada’s Finance Minister delivered the 2025 federal budget. While there were no major changes to personal or corporate income tax rates or GST, the budget introduces notable updates to tax incentives, transfer pricing rules, and other personal tax measures.

The key highlights of budget:

No change is proposed in personal or corporate income tax rates.
Scientific Research and Experimental Development (“SR&ED”) Program: The budget increases the expenditure limit for the enhanced 35% SR&ED tax credit from CAD 4.5 million to CAD 6 million, applicable to taxation years beginning on or after December 16, 2024, providing additional support for businesses investing in R&D.
Temporary immediate expensing would be allowed to certain eligible manufacturing and processing buildings acquired on or after November 4, 2025, subject to relevant conditions.
Budget 2025 proposes to implement a variety of changes to Canada’s transfer pricing rules, effective for taxation years beginning after 4 November 2025. Proposed changes include the following:

Transactions must be assessed based on economically relevant factors, including market conditions, business strategies, asset and risk allocation, and the actual conduct of the parties, in addition to contractual terms.
The penalty threshold for transfer pricing adjustments will increase from CAD 5 million to CAD 10 million.
The time allowed to submit contemporaneous documentation to the CRA is reduced from three months to 30 days.

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

China

China: Shanghai introduces paid elder care leave for hospitalized parents

On September 25, 2025, the Standing Committee of the Shanghai Municipal People’s Congress approved amendments to the Shanghai Municipality Regulation on the Protection of the Rights and Interests of the Elderly. These changes took effect on November 1, 2025, and introduced a new mandatory paid elder care leave for employees when a parent is hospitalized due to illness.

Under the updated rules, employees are entitled to paid leave each year when an elderly person is hospitalized for medical treatment. Eligible caregiver may take up to five working days if they have siblings, or up to seven working days if they are only child under China’s former one-child policy. The leave applies to employees who are the primary legal caregiver, which may include parents or other elderly relatives for whom the employee has a legal duty of care.

Employees must receive full pay during elder-care leave, equivalent to their normal earnings, consistent with other statutory family-related leaves such as parental and childcare leave.

Granting elder-care leave is mandatory. Employers who refuse to provide leave may face enforcement action under PRC labour law. Employees may file complaints with labour authorities or pursue labour arbitration to recover lost wages or related caregiving costs.

Implication:
Shanghai employers must update leave policies and HR procedures to include new mandatory paid elder-care leave; ensure payroll systems maintain full pay during the leave.

China: New Value Added Tax law and the implementation regulations became effective from January 1, 2026.

The Standing Committee of the 14th National People’s Congress (“NPC”) passed the new Value Added Tax (“VAT”) law on December 25, 2024, followed by the president’s approval through Order No. 41. The new VAT law came into force from January 1, 2026, replacing the existing VAT regulations which were in place since last 30 years. Further, State Council Decree No. 826 promulgating the Implementation Regulations was published on December 30, 2025, and took effect on January 1, 2026.

The new VAT law maintains the existing three-tier VAT rate system of 13% (for general sales and import of goods), 9% (for sale of services), and 6% (for modern services). The taxable transactions include sales of goods, services, intangible assets, immovable property, and imports of goods. Unlike the existing regulations, the new law specifically distinguishes the sale of financial products as a separate category from the sale of services. The law provides clarity on many grey areas.

A detailed note on the new VAT law can be accessed on our website.

The Implementing Regulations contains 6 chapters and 65 articles and aim to provide detailed rules for effective implementation of the new VAT law.

The key provisions of the Implementation Regulations are as follows:

The regulations clarify the term ‘consumption of services and intangible assets in China’. With respect to supply by overseas entities of such services/assets to domestic entities, the consumption will include such supplies to domestic entities/ individuals but will exclude services consumed onsite overseas. Thus, the consumption place principle has been clearly established. Further services/ goods which are directly related to goods, immovable property or natural resources in China would also be considered as taxable in China.
The regulations clarify that zero VAT rate will apply to cross-border sale by domestic entities/individuals of specified services such as R&D services, energy performance contracting design services, business process management services, software services, offshore service outsourcing services, etc. which are sold to overseas entities and fully consumed overseas. It will also apply to technology transfer to overseas which is fully consumed overseas.
Regulations clarify the definition of the term ‘mixed transaction’. The earlier requirement to have both goods and services supply in a single transaction has been done away with. The new definition requires that there should be two or more activities involving different tax rates and also the existence of principal ancillary relationship among activities.
Regulations clarify input VAT credit rule for fixed/intangible assets and real estate. For a single asset with an original value less than equal to RMB 5 million, input VAT can be fully credited upfront. But for a single asset with an original value more than RMB 5 million, input VAT is initially fully credited. However, if used for both creditable and non-creditable purposes, a portion must be adjusted and disallowed annually based on usage.
Regulations also require taxpayers to carry out annual reconciliation for apportionment of input VAT where purchased goods on which such input VAT is paid are used for general tax calculation transactions, simplified tax calculation transactions, VAT exempt transactions, non-deductible non-taxable transactions etc.
The Regulations provide that the small-scale taxpayers whose transactions value exceed the sales threshold should calculate and pay VAT using the general tax method from the period in which the threshold is exceeded. Earlier, such taxpayers were required to complete general taxpayer registration within 15 days period after the end of the relevant tax period and start paying taxes under general regime from the first date of registration month or following month. No transition period is available under new regulations.
Regulations introduce General Anti-Avoidance Rule (“GAAR”) under which the tax authorities are authorized to make adjustments to transactions or arrangements deemed to lack “reasonable business purpose” and result in VAT avoidance.

Implication:
Businesses should evaluate impact of new VAT law and implementation regulations on their VAT liability and compliance requirement.

China: China introduces VAT rules for digital platform intermediaries

China has introduced new value‑added tax (“VAT”) regulations targeting digital platform intermediaries as part of its broader effort to improve tax compliance in the digital economy. The rules are applicable to digital platforms such as online marketplace for goods, platforms facilitating services including digital and on demand services, platform controlling or processing payments or platforms organizing transactions between multiple customers and sellers.

The regulations require platforms to submit quarterly reports to the Chinese tax authorities (“STA”) on the identity and income of sellers and workers, while the first report was due in October 2025. These rules align closely with international standards, including the OECD model reporting rules for digital platforms.

Key provisions are as under:

Platforms operators must provide detailed information, including business name, domain, and transaction revenue, within 30 days of the rules taking effect or starting operations.
Platforms operators are responsible for verifying the accuracy and completeness of tax information for sellers and workers.
Quarterly reporting of seller and worker income is required.
Platforms are exempt from reporting tax information for individuals providing certain public services, such as delivery, transportation, and domestic work, if they are tax-exempt or not subject to tax under current laws. Reports are also not required for transactions before 13 June 2025, the effective date of the rules, or for information already submitted through withholding or proxy declarations.
The STA will provide secure reporting channels and maintain confidentiality.
During audits, platforms may need to provide contracts, transaction details, financial records, and logistics information.
Penalties apply for failing to report, submitting false or incomplete information, or not correcting deficiencies when instructed.

Implication:
Businesses and digital platforms should review and update their reporting processes to meet the new compliance requirement.

Finland

Finland: Intrastat arrivals reporting requirement discontinued from January 2026.

Finland Customs authorities had announced discontinuation of requirement to file Intrastat declaration for arrivals in Finland from January 2026. Finnish Customs will instead use microdata received from other countries to compile EU import statistics, reducing the administrative burden on businesses. The reporting threshold for dispatches will remain unchanged at EUR 800,000. Companies previously required to report both arrivals and dispatches will continue to report dispatches as usual.

Finnish Customs has sent individual notification to companies about the termination of their obligation to report arrivals. The final Intrastat declaration for arrivals was applicable for December 2025 which was to be filed by January 16, 2026.

Implications:
Businesses will benefit from reduced reporting obligations for EU arrivals but should ensure timely submission of despatches related information in 2026.

Finland: Parliament approved lowering of reduced VAT rate from 14% to 13.5% from January 2026.

Finland: Parliament approved lowering of reduced VAT rate from 14% to 13.5% from January 2026.

Implications:
Businesses should update their invoicing and ERP system to ensure correct VAT rate application.

France

France: France adopts special Finance Bill to continue 2025 tax provisions in 2026.

On December 23, 2025, the French Parliament adopted a Special Finance Bill for 2026 after the draft Finance Bill presented on October 14, 2025, failed to progress. The National Assembly had rejected the first section of the draft budget on 21 November 2025. Since the National Assembly did not adopt the first part of the bill, it is considered to have been rejected on first reading. This special law was introduced to ensure continuity of public finances by temporarily extending the tax rules and budget framework that applied in 2025 into 2026. It also authorizes the government to continue collecting taxes and raising funds until a new finance bill is approved.

A full Finance Bill for 2026 is expected to be adopted later, likely in the first quarter of 2026.

Implications:
Businesses should take note of this development and ensure that their tax planning and compliance for early 2026 are based on the continuation of the 2025 tax rules and budget framework until a full Finance Bill for 2026 is adopted.

France: France introduced new birth leave for both parents; social contribution on mutual termination payment increased.

The Social Security Financing Law (“LFSS”) for 2026, adopted and published in the official Journal on December 30, 2025, introduces several measures that affect employer costs, including contributions, exemptions, and deductions.

The key changes are as under:

Social security contribution on indemnities under mutual termination agreements and retirement payments would increase from 30% to 40%.
The law has postponed the pension reforms to raise retirement age and increased period of insurance required to January 1, 2028.
Starting from July 1, 2026, a new state paid birth leave will be available to parents, supplementing existing maternity, paternity, or adoption leave. The leave will be available from July 2026 for children born on or after January 1, 2026, including premature births with 2026 due dates. Each parent will be entitled to up to two months of paid leave, which can be taken as one month, two consecutive months, or two separate one-month periods. It will have to be taken within 9 months of birth or adoption but after utilizing maternity/paternity/ adoption leave entitlement. The compensation for leave will be as under:

First month: 70% of net salary
Second month: 60% of net salary

Implication:
Businesses should analyse the impact of the changes like deferment of pension reform, increase in social security contribution on terminations, new birth leave and update their payroll and human resource processes.

France: The social security ceiling increased by 2% from January 1, 2026.

Effective from January 1, 2026, the Annual Social Security Ceiling (“PASS”) in France increased by 2%, rising from EUR 47,100 in 2025 to EUR 48,060. According to the decree of December 22, 2025, the ceiling’s monthly value will be EUR 4,005 (up from EUR 3,925). These updated values will serve as the basis for calculating social security contributions and benefits throughout 2026.

Implication:
Businesses should update payroll systems to reflect the higher social security ceiling, as this will affect contribution calculations and benefit limits for employees.

Germany

Germany: Federal Cabinet approved updated social security contribution bases for 2026.

On October 8, 2025, the Federal Cabinet approved the Social Security Calculation Parameters Regulation 2026 updating maximum bases for social security contributions which took effect from January 1, 2026. The key changes are as under:

The maximum base for statutory health and long-term care insurance will rise to EUR 69,750 per year (2025: EUR 66,150), or EUR 5,812.50 per month (2025: EUR 5,512.50). Contributions are only levied on income up to this limit.
The maximum base for statutory pension insurance will be increased to EUR 101,400 (2025: EUR 96,600) per year, or EUR 8,450 (2025: EUR 8,050) per month. Income above this level will not be subject to pension insurance contributions.
The compulsory insurance limit will increase to EUR77,400 (2025: EUR 73,800), or EUR 6,450 per month (2025: EUR 6,150). This threshold determines whether employees are eligible to opt out of statutory health insurance and take up private health insurance.

Implication:
Employers should update their payroll processes to give effect to increased ceiling and estimate the impact on employer contribution outgo.

Germany: Parliament approved Tax Amendment Act 2025, increasing commuter allowance.

On December 04, 2025, Germany’s lower house of parliament (Bundestag) approved the Tax Amendment Act 2025, introducing certain tax relief measures for individuals. It was also passed by the German Federal Council (“Bunderstrat”) on December 19, 2025.

The key income tax changes relevant for individuals include –:

It increases the commuter allowance to 38 cents per kilometre for journey between home and work from the first kilometre. Earlier, this rate was applicable to travel beyond 21 km.
The mobility premium for low-income earners is made permanent. It is applicable beyond 21 Km travel to low-income earners.
Actual expenses incurred on accommodation can be claimed as deduction up to 2 households. Now the law specifies maximum limit of EUR 2,000 per month for apartment maintained abroad. This limit is EUR 1,000 per month for domestic accommodation.

Other changes include reduction in VAT rate from 19% to 7% for catering and restaurant services, increased exemption for part time volunteering activities, etc. The changes would come effect from January 1, 2026.

Implication:
The changes would provide relief to individuals.

India

India: Karnataka State introduces menstrual leave for all sectors.

On October 09, 2025, the Karnataka Cabinet approved the Menstrual Leave Policy, making Karnataka the first Indian state to mandate paid menstrual leave across both public and private sectors. The order grants women employees one paid menstrual leave per month, amounting to up to 12 days annually. The leave will be available to women between the age 18 to 52 years.

The Policy applies to women working in government offices, information technology firms, multinational companies, and garment units, etc. It is based on the recommendations of a 2024 expert panel constituted to draft the Right of Women to Menstrual Leave and Free Access to Menstrual Health Products Bill. Notably, the approved entitlement doubles the panel’s earlier recommendation of six days per year.

Implication:
Employers across sectors will need to revise leave policies and ensure compliance. The initiative may inspire similar measures in other states, promoting inclusivity and support for women in the workforce.

India : India launched simplified GST registration system under GST 2.0.

Effective from November 01, 2025, India has implemented a simplified Goods and Services Tax (“GST”) registration system as part of the GST 2.0 reforms approved by the GST Council. The new framework introduces a digital, risk-based registration process with automatic approval for most new applicants within three working days, significantly reducing manual intervention.

The reform aims to enhance transparency, accelerate onboarding, and ease compliance for businesses seeking GST registration.

Implication:
The reform is to improve ease of doing business by shortening registration timelines, while requiring businesses to ensure accurate digital documentation under the new risk-based system.

India: India implements new labor codes from November 21,2025; Government published draft rules.

India’s Ministry of Labour and Employment has issued notifications to implement the new labour laws with effect from November 21, 2025. These notifications activate major provisions of four Labour Codes: The Code on Wages, 2019; Code on Social Security, 2020; Industrial Relations Code, 2020; and the Occupational Safety, Health and Working Conditions (“OSHWC”) Code, 2020. For full implementation, both Central and State Governments must notify detailed rules and related schemes.

Additionally, the Central Government, on December 30, 2025, published the draft Central Rules under each of the four Labour Codes for public consultation which is open for public comments for 30-45 days.

Key highlights of labour codes

Clearer definitions of employee and worker – The Codes distinguish between “employee” and “worker,” clarifying coverage and exclusions, especially for managerial, administrative, and higher-paid supervisory roles. New categories such as gig workers, platform workers, and aggregators are also formally defined.
Uniform definition of wages – A standard definition of “wages” now applies across all Codes. While basic pay and allowances such as dearness allowance are included, certain allowances are excluded, subject to a cap of 50% of total salary. This broader definition will increase employer costs for benefits like gratuity, PF, and bonus.
Gratuity insurance requirement – Under the Social Security Code, employers will eventually be required to insure their gratuity liability, unless they have an approved self-managed gratuity fund or employ more than 500 employees with such a fund.
Minimum wages framework -A national floor wage will be fixed by the Central Government, while States will set minimum wages aligned to this floor, extending coverage to unorganised sector workers.
Working hours and wage payment timelines -Working hours are capped at 48 hours per week, with flexibility up to 12 hours a day including rest breaks. Monthly wages must be paid within 7 days of month-end, and final dues must be settled within 2 working days of resignation or termination.
Changes in workforce models -Use of contract labour in core activities is restricted, with limited exceptions. The Codes formally recognise fixed-term employment, granting such workers proportional benefits, including gratuity after one year.
Expanded social security coverage -Social security benefits are extended to gig workers, platform workers, fixed-term employees, and unorganised workers. Aggregators may be required to contribute 1–2% of turnover toward gig worker welfare. Commute-related accidents are treated as work-related, and work-from-home may be requested after maternity leave where feasible.

Key highlights of draft rules for implementation of labour codes

Clarification on the definition of wages for gratuity: For gratuity calculation, certain components will be excluded (within the 50% cap), such as medical reimbursements, stock options or cash equivalents, crèche allowance, telephone and internet reimbursements, and meal vouchers. Any payment payable on annual basis which is linked to performance/ productivity of the employee or employer’s establishment, and which is not payable under the terms of employment is excluded from wages.
Fixed term employee gratuity: Gratuity is payable to fixed-term employees if they render service under the contract for at least one year. Any subsequent period of service more than six months but less than one year, will be considered as one additional year.
Creche facility: Employer and trade unions or majority of employees can enter into agreement regarding provision of creche facility in the establishment. Where creche facility is not provided, creche allowance may be paid at minimum of Rs. 500 per month per child.
Social security eligibility for gig and platform workers: The draft rules define minimum engagement thresholds for social security coverage. Gig and platform workers must be engaged for at least 90 days with one aggregator in a year, or 120 days across multiple aggregators in the previous financial year, to qualify.
Contract labour: The Codes do not allow use of contract labour for core activities. The Joint Secretary, Ministry of Labour and Employment, is empowered to determine whether an activity qualifies as a core activity. Contractor employees receiving minimum annual increments of at least 2% will be excluded from the definition of contract labour. Contractors operating across multiple States may apply for a common licence through the Shram Suvidha Portal.
Overtime threshold for workers: Overtime eligibility applies for work exceeding 48 hours in a week, with no separate daily threshold. For daily wage workers, overtime applies for work beyond 8 hours in a day.
Mandatory appointment letters and worker welfare: Employers must issue appointment letters to all employees within three months of the rules coming into force. Additional welfare measures include mandatory annual health check-ups for employees above 40, consent-based night shifts for women, and provision of crèche facilities or payment of a minimum crèche allowance of INR 500 per child per month.
Registers, record Retention, and annual returns: The draft rules prescribe unified annual returns, multiple mandatory registers (wages, attendance, overtime, women employees, etc.), five-year record retention, and maintenance of records in prescribed languages.

Implication:
Employers should evaluate impact of labour code and draft rules on their employment and human resource policies. Changed definition of wages and further clarification in draft rules would have substantial impact on payment of gratuity and other benefits. Higher gratuity payment would require higher provisioning in accounts. Employers should track notification of final rules by the state and central government.

India: MCA publishes revised thresholds for qualification as small companies.

The Ministry of Corporate Affairs (“MCA”) has revised the definition of a small company by way of an amendment to rule 2(1)(t) of the Companies (Specification of Definition Details) Rules, 2014.

As per the amendment, the company which is not a public company will qualify as a ‘small company’ if it is a company with paid-up share capital not exceeding INR 100 million (earlier INR 40 million) and turnover as reflected in the profit and loss account of the immediately preceding financial year not exceeding INR 1 billion (earlier 400 million).

If a company meets the above criteria, it enjoys certain benefits such as exemption from the requirement to prepare cash flow statement, exemption from mandatory internal audit requirement, simplified rules for board meeting and filing requirements, etc.

Implication:
The revised thresholds will bring in more companies within the ambit of the term ‘small companies’, enabling more entities to benefit from reduced compliance requirements under the Companies Act.

Ireland

Ireland: Highlights of Budget 2026.

The Ireland’s new Government presented its first Budget on October 7, 2025, proposing various measure to strengthen economic resilience, supporting growth, and maintaining fiscal discipline amid global uncertainty.

The key proposals are as under:

Budget proposes increase in Research and Development (“R&D”) tax credit from 30% to 35%. The first-year payment threshold for full upfront claims is proposed to be increased to EUR 87,500. Further, the government plans to make certain administrative reforms regarding outsourcing rules, qualifying expenditure definitions, etc.
The Key Employee Engagement Programme (“KEEP”) for SMEs will be extended until the end of 2028 (earlier 2025), subject to European Commission approval. It is a tax efficient share option scheme for employees of Irish company.
The limit for capital gains tax (“CGT”) Entrepreneur Relief is proposed to be increased from EUR 1 million to EUR 1.5 million for qualifying disposals made from 1 January 2026.
The Special Assignee Relief Programme (“SARP”) will be extended for five years to 2030, with the minimum qualifying income threshold increased from EUR 100,000 to EUR 125,000. This is a program which encourages multinational companies to assign key employees to work in Ireland by granting tax exemption of their income up to specified threshold.
Tax beneficial treatment for determining benefits-in-kind for company provided electric (zero emission) car will be extended to 2029. The relief applies by reducing the original market value of the car and accordingly, benefit-in-kind value is calculated on the residual market value after reducing such relief.
The Foreign Earnings Deduction (“FED”) will be extended to 2030. The income cap eligible for relief will increase from EUR 35,000 to EUR 50,000, and the incentive will be expanded to cover qualifying work undertaken in the Philippines and Türkiye. This deduction which goes to reduce taxable income is available to a resident who works abroad for temporary period subject to certain conditions.
Additionally, the budget also proposes certain VAT reform like reduction of VAT rate from 13.5% to 9% on sale of apartments, food and catering services, extension of VAT relief on electric vehicles, etc. The budget proposals also include other provisions relating to participation exemption for foreign dividend, stamp duty related changes, etc.

Implication:
Businesses claiming R&D benefit should evaluate impact of changes. Employer should take not of changes related to key employment engagement program, Special Assignee Relief Programme, benefit in kind taxation changes.

Ireland: Tax Authority announces phased implementation of mandatory e-invoicing and real-time VAT reporting program.

On October 08, 2025, the Irish Revenue published document called “VAT Modernisation: Implementation of e-invoicing in Ireland”, outlining its preparations for implementing the EU’s VAT in the Digital Age (“ViDA”) initiative. ViDA aims to modernise VAT systems across the EU to better reflect modern business practices while strengthening measures to combat VAT fraud.

As per the plan, e-invoicing and real-time reporting will be introduced gradually to allow both businesses and tax authorities sufficient time to prepare ahead of the EU-mandated deadline of July 01,2030. The proposed three-phase implementation timeline is as follows:

Phase 1 – November 2028: VAT-registered large corporates to implement e-invoicing and real-time reporting for domestic B2B transactions.
Phase 2 – November 2029: Extension of domestic B2B e-invoicing and real-time reporting to all VAT-registered businesses engaged in intra-EU B2B trade.
Phase 3 – July 2030: Full implementation of EU ViDA requirements including all cross-border EU B2B transactions across all 27 EU Member States.

All businesses will be required to have the capability to receive e-invoices from suppliers covered under the phased rollout.

Implication:
Businesses will need to invest in system upgrades, cross-functional coordination, and process changes to ensure timely compliance with Ireland’s domestic e-invoicing framework and the EU ViDA requirements. This would have impact across functions such as tax, finance, IT, procurement, etc.

Ireland: Enhances gender pay gap reporting obligation.

The Irish Government enacted the Employment Equality Act 1998 (Section 20A) (Gender Pay Gap Information) (Amendment) Regulations 2025, introducing notable changes to gender pay gap reporting requirements for employers as under:

The Regulations reduce the employee threshold for mandatory reporting from 150 to 50 employees, significantly expanding the number of organisations required to comply.
The Regulations also shortened the reporting timeline. Employers must now publish their gender pay gap results within five months of the “snapshot date” in June, i.e., no later than the end of November.

Implication:
More employers will now fall within the scope of gender pay gap reporting and will need to review internal systems and timelines to ensure compliance with the expanded obligations and tighter reporting deadlines.

Ireland: Auto-enrolment pension regime became effective from January 1, 2026.

From January 1, 2026, the new mandatory retirement savings scheme namely, My Future Fund has taken effect under the Automatic Enrolment Retirement Savings System Act 2024, following multiple postponements from its original start date of January 2025. This regime is state run auto-enrolment system where all those earning more than EUR 20,000 and having age between 23 -60 will be covered if they are not contributing to a workplace pension scheme or additional pension arrangement.

The key updates are as follows:

A minimum total pension contribution of 3.5% of gross pay will apply initially, with at least 1.5% payable by the employer and the employee each and 0.5% contributed by the state. Employee and employer contribution will increase to 6% over 10 years while State contributions will go up to 2%.
Employers need to register with National Automatic Enrolment Retirement Savings Authority (NAERSA). Compliance with the new rules will be overseen by NAERSA.
Employee can opt out of the scheme after 6 months period within 2 months window of 7^th and 8^th month. On opting out, the employee will be refunded his contribution, but employer and government contribution would remain in the scheme. After 8 months period, employee cannot opt out but can suspend the contribution.

Implication:
Employers should update their systems and processes to meet new requirement. They also need to estimate the additional costs towards employer contribution and evaluate its impact.

Ireland: Employment (Contractual Retirement Ages) Bill 2025 allows employee an option to work till legal pensionable age.

Ireland has enacted The Employment (“Contractual Retirement Ages”) Act 2025. The Act will require a commencement order before its provisions come into effect.

The following are the key provisions:

The Bill introduces a consent-based approach to contractual retirement ages (“CRAs”) which is retirement age specified in employment contract. Where an employee is subject to a CRA below the pensionable age and does not consent to retire, the employee must notify the employer in writing.
Such notice should be given at least three months but not more than one year before reaching the CRA. Where termination notice as per employment contract is more than 3 months, CRA notification should be such period or period of 6 months whichever is less.
Employers will be required to issue a reasoned written response to employee’s notice.
Where the employer, without reasonable cause, fails to provide a reasoned written reply, it would be treated as an offence. On summary conviction, an employer may be liable to a Class A fine of up to EUR 5,000, imprisonment for up to 12 months, or both. The offence applies not only to the corporate entity but also to directors, managers, secretaries, or other officers where the offence is committed with their consent or connivance.

Implication:
Employers should review existing contracts to identify relevant cases and ensure robust procedures are in place to respond in writing to employee notifications.

Japan

Japan: Parliament passes law introducing measures to prevent customer harassment and job seekers’ harassment.

Japan’s parliament passed Act (No 63 of 2025) amending the Act on Comprehensive Promotion of Labor Policies, Stabilization of Employment of Workers, Enrichment of Occupational Life, etc. which was promulgated on June 11, 2025. The amendments aim to prevent harassment by customers, harassments of job seekers and enhance gender gap reporting requirements.

Key provisions are as under:

Customer Harassment Prevention: Under the new provisions, employers will be required to take steps to prevent employee harassment by customers. Customer harassment refers to conduct by third parties, such as customers, business partners, or facility users that exceeds socially acceptable behaviour and negatively impacts the work environment. The government will issue guidelines in this respect.
Customer Harassment Prevention: Under the new provisions, employers will be required to take steps to prevent employee harassment by customers. Customer harassment refers to conduct by third parties, such as customers, business partners, or facility users that exceeds socially acceptable behaviour and negatively impacts the work environment. The government will issue guidelines in this respect.
Balancing medical treatment with work responsibilities: Effective April 1, 2026, employers would be required to take measures to support employees to balance their ongoing medical treatment with work responsibilities. Government will issue guidelines in this respect.
Gender gap reporting: Effective April 1, 2026, employers with 101 or more employees will be required to make public disclosure regarding gender pay gaps and the percentage of female managers.

Separately, the Act No 33 of 2025 which partially amend the Occupational Safety and Health Act, and the Work Environment Measurement Act was promulgated on May 14, 2025. As per the amendment, all employers including those with less than 50 employees will be obliged to conduct stress check of their employees. The government will notify when the provisions apply to employers with less than 50 employees.

Implication:
The amendments significantly expand employer responsibilities and compliance scope. Employers should conduct review of their systems and processes and take necessary steps to prepare for new requirement.

Malaysia

Malaysia: E-Invoicing annual turnover threshold increased from RM 500,000 to RM1 million.

The Inland Revenue Board of Malaysia (“IRBM”) released updated guidance on December 7, 2025, increasing annual turnover threshold for the mandatory e-invoicing from RM 500,000 to RM1 million.

This means that the previously planned Phase 5 rollout on July 1, 2026, for businesses with turnover below RM 500,000 stands cancelled. Rest of the schedule remains unchanged including the six months relaxation period of each phase wherein consolidated e-invoices can be issued without penalties.

Implication:
This change reduces compliance burden on small businesses having turnover below RM 1 million.

Netherlands

Netherlands: Tax Plan 2026 approved by the Dutch Parliament.

The Senate (upper house of parliament) approved the 2026 tax plan on December 16, 2025. Most of the provisions are effective from January 1, 2026. The following are the major amendments introduced in the tax plan:

Corporate income tax rates remain unchanged, at 19% on profits up to EUR 200,000 and 25.8% above that amount.
Personal Income Tax:

Changes to Box 1 (Income from work and home ownership) (for individuals below state pension age):

Taxable Income Slabs (2026) (Amounts in EUR)	Tax rate (2026)	Taxable Income Slabs (2025) (Amounts in EUR)	Tax rate (2025)
Up to 38,883	35.75%*	Up to 38,441	35.82% *
38,884 to 78,426	Up to 38,883	38,442 to 76,817	37.48%
Above 78,426	49.50%	49.50%	49.50%

* Includes state pension contribution rate of 17.90%.:

In 2026, the rates for national social security contributions in the Netherlands remain unchanged. Contribution towards the state pension (AOW) is 17.90%, the Surviving Dependants Act is 0.10%, and the Long-Term Care Act is 9.65%.
The maximum wage considered for employee insurance contributions is EUR 79,409. Employer’s contribution for the Invalidity Insurance Fund (Aof) for large employers is 7.63%, while for small employers it is 6.27%. Contributions to the General Unemployment Fund (Awf) are 2.74% for permanent contracts and 7.4% for other types of employment.
Under the Healthcare Insurance Act (Zvw), employers will contribute 6.10% on wages up to EUR 79,409, and employees with other income will pay an additional 4.85% on wages up to the same limit.
For private use of company car by employee, the perquisite value is considered at 22% of catalogue value. In case of electric car, discount is provided. Such discount is 4% for 2026 and 2% for 2027 capped at EUR 1200 and 600 for 2026 and 2027 respectively.

Implication:
The employers should update their payroll systems to give effect to changes in taxes on salary and social security contribution.

Singapore

Singapore: Compensation Limits for work related accidents increased effective from November 01, 2025.

From November 01, 2025, the maximum and minimum compensation limits for work-related death, permanent incapacity, and medical expenses will increase as follows:

Death: up to SGD 269,000 (minimum SGD 91,000)
Permanent incapacity: up to SGD 346,000 (minimum SGD 116,000)
Medical expenses: up to one year from the date of the accident up to maximum of SGD 53,000.

Expanded Occupational Disease Coverage (Effective December 01, 2025)

From December 01, 2025, the schedules of reportable and compensable occupational diseases under the Workplace Safety and Health Act (WSHA) and WICA have been harmonized. The updated schedule covers 38 specified occupational diseases across physical, chemical, biological, musculoskeletal, respiratory, skin, and malignant conditions.

Implication:
Employers should review insurance coverage and workplace health policies to ensure compliance with the higher compensation limits and expanded occupational disease coverage, in order to efficiently manage potential increases in liability exposure.

Singapore: Parliament passes bill introducing elaborate dispute resolution framework.

Singapore parliament passed the Workplace Fairness (“Dispute Resolution”) Bill on November 04, 2025, which is the second and final part of the Workplace Fairness Act. The first part of the Act, which defines and prohibits workplace discrimination, was passed on January 08, 2025. Together, these two parts establish a comprehensive statutory framework for addressing workplace discrimination and are expected to be implemented by the end of 2027.

The key features are as under:

Three-Step dispute resolution framework

The Bill introduces a mandatory three-step process for alleged discriminatory employment decisions:

Internal grievance handling – Employees must first raise discrimination concerns through their employer’s internal grievance process.
Mediation – If internal grievance handling fails, the parties must proceed to mediation.
Adjudication – Where mediation is unsuccessful, claims may be brought before the Employment Claims Tribunal (ECT) for claims of up to SGD250,000. Claims exceeding this amount will be heard by the High Court of Singapore.

All mediation sessions and ECT proceedings will be conducted in private to preserve confidentiality and reduce reputational risk.

Expanded role of the employment claims tribunal
The Bill expressly empowers the ECT to hear workplace fairness disputes involving alleged discriminatory employment decisions. This represents a significant enhancement of statutory protection for employees. Employers are therefore expected to establish, formalise, or review internal grievance procedures to ensure compliance with the new legal framework.

Safeguards against frivolous claims
To balance enhanced employee protections, the Bill introduces new procedural safeguards, including:

prescribed time limits for mediation requests;
a mechanism to strike out frivolous claims at an early stage;
the power for the ECT to award costs to discourage filing frivolous claims;
authority to refer persistent abuse of process to the Singapore Police or to restrain claimants from initiating further proceedings; and
enforcement powers for non-compliance with ECT orders, including fines ranging from SGD5,000 to SGD 250,000.

These measures aim to prevent misuse of the dispute resolution process while protecting the integrity, privacy, and enforceability of legitimate claims.

Implication:
Employers should proactively review and formalise internal grievance mechanisms and train management on discrimination handling.

Singapore: Parliament passes amendment to enhance tax deduction for payments under employee equity-based remuneration scheme.

Singapore parliament passed an amendment to Income-tax Act, 1947 to give effect to the announcement made in Singapore’s Budget 2025, whereby companies will be able to claim tax deductions for payments made to a holding company or special purpose vehicle (“SPV”) for the issuance of new shares under Employee equity-based remuneration (“EEBR”) schemes from the Year of Assessment (“YA”) 2026. Previously, tax deductions were only available where EEBR obligations were satisfied using treasury shares. Further, the Inland Revenue Authority of Singapore (“IRAS”) issued an updated e-Tax Guide providing further guidance on this aspect in September 2025.

The key highlights are as under:

Deduction can be claimed at the time of vesting of shares to employees or when the company becomes liable to pay the recharge to its holding company or SPV, whichever occurs later. This is consistent with the treatment for treasury shares.
The e-Tax Guide clarifies that eligibility for the enhanced deduction is determined by the vesting date. While the vesting of shares must occur in the basis period for YA 2026 or later, the grant of shares under an EEBR scheme may take place before the basis period for YA 2026. Similarly, the recharge to the holding company or SPV may also occur before the basis period for YA 2026.
The amount deductible will be lower of the following –

Amount paid to holding company or SPV less any amount payable by the employee;
Market price of shares at the time of issue/transfer to employee or net asset value if market price is not available as reduced by the amount paid by the employee.

Companies claiming such deduction are required to disclose certain details in their tax computation schedule such as details of EFBR scheme, confirmation that no claim was made earlier for relevant payment, method of calculation, etc.

Implication:
The enhanced regime provides greater flexibility and tax efficiency for companies using equity-based incentives, particularly for groups issuing new shares through holding companies or SPVs. Employers should review existing and upcoming EEBR schemes to ensure vesting schedules and recharge arrangements are structured to maximize the available tax deductions.

Singapore: Part-Time Re-employment grant extended to 2027 in Singapore.

Singapore has extended the Part-Time Re-employment Grant (“PTRG”) to December 31, 2027, in response to continued demand. The grant supports the employment of senior workers by encouraging employers to offer part-time re-employment, flexible work arrangements, and structured career planning.

The Ministry of Manpower has announced that the application for the extended scheme reopened on December 18, 2025. Eligible employers may receive a grant of SGD 2,500 for each senior worker aged 60 and above who is employed under qualifying arrangements, subject to a maximum grant cap of SGD 125,000 per employer.

Implication
The extension provides ongoing financial support for employers to retain and re-employ senior workers, helping businesses address workforce needs while promoting flexible and age-inclusive employment practices.

Spain

Spain: Spain delays veri*factu e-Invoicing rollout by one year.

Vide Royal Decree-Law 15/2025 of December 2, 2025, the Ministry of Finance, Spain has officially delayed the adoption of invoicing software system by one year.

The revised schedule is as under:

Corporate taxpayers will need to adopt the system from January 1, 2027 (earlier January 1, 2026),
Freelancers and other taxpayers must comply from July 1, 2027 (earlier July 1, 2026).

Under Veri*factu, invoicing software are required to either generate and store secure and traceable invoice records or transmit those records directly to the Spanish Tax Authority. Entities that are already reporting under Spain’s Immediate Supply of Information (SII) system or using simplified VAT regimes are partially exempt from the Veri*factu requirements.

Implication:
Businesses should note the revised Veri*factu deadlines and should review their invoicing systems and compliance processes to ensure readiness for the updated implementation dates.

Switzerland

Switzerland: VAT increase from 8.1% to 8.8% delayed to Jan 2028.

Switzerland has postponed its planned increase in the standard VAT rate from January 2026 to January 2028. The standard rate was originally set to rise from 8.1% to 8.8%. The postponement delays both the parliamentary approval process and the mandatory public referendum required for the measure to take effect.

Implication:
The delay provides short-term VAT stability for businesses and consumers, while extending uncertainty over medium-term pricing and tax planning pending legislative approval and a public vote.

Thailand

Thailand: Parliament passes law to enhance maternity and paternity leave entitlement.

Thailand parliament passed Labour Protection Act (No. 9) B.E. 2568 (2025) which was published in official gazette on November 7, 2025, and became effective from December 7, 2025, that is 30 days after the publication.

The key changes are as under:

Maternity and paternity leave: Maternity leave per pregnancy increased from 98 days to 120 days out of which first 60 days are fully paid. Further, where the baby suffers from medical complications, disorders or disability, an additional leave of 15 days at 50% pay is available. Father would get 15 days of paid paternity leave which should be taken in 90 days after the childbirth.
Menstrual leave: Female employees will be eligible for a day of menstrual leave per cycle, in addition to normal sick leave eligibility. Payment would be as per employer internal policy or collective agreement.
Reporting compliance: Employer with 10 or more employees are required to submit a report on employment and working conditions to Department of Labor Protection and Welfare in January each year. Earlier the law required multi step submission, but the law now provides for submission as may be prescribed.

Separately, Thailand’s House of Representative has in principle approved draft Bill on Worker’s Rights which is currently under legislative process and yet to be passed. The key provisions of this Bill are as under:

Reduced working hours: Normal working hours are proposed to be capped at 40 hours per week (down from 48). For hazardous work, working hours are proposed to be capped at 35 hours per week (down from 42).
More rest days: At least 2 days off per week, with no more than 5 consecutive working days between rest days. Currently, law requirement is 1 day off per week.
Increased annual leave: The law proposes at least 10 days of annual leave after working for 120 consecutive working days. Currently annual leave entitlement is 6 days after one year of service.

Implication:
Employers need to amend their policies to give effect to changes in maternity, paternity and menstrual leave. They should stay updated on other developments regarding reduced working hours, rest days, etc.

Thailand: New social security fund wage ceiling announced effective from January 1, 2026.

Thailand’s Social Security Fund (“SSF”) has officially announced a new wage ceiling, which took effect on January 1, 2026. The change was published in the Royal Gazette on December 12, 2025, following Cabinet approval on December 2, 2025, for the updated wage thresholds used to calculate social security contributions.

Three-Phase Wage Ceiling Increase

The SSF wage ceiling will be increased gradually in three phases:

Phase 1: 2026–2028

Maximum wage base: THB 17,500
Maximum monthly contribution: THB 875

Phase 2: 2029–2031

Maximum wage base: THB 20,000
Maximum monthly contribution: THB 1,000

Phase 3: 2032 onward

Maximum wage base: THB 23,000
Maximum monthly contribution: THB 1,150

The minimum contribution base remains unchanged at THB 1,650 per month.

Implication:
The increase in base will impact social security contribution and employers should update their payroll system accordingly. The change would also have impact on benefits such as sickness, disability, unemployment compensation, maternity grant, pension etc.

UAE

UAE: UAE amends VAT law introducing 5 years statutory limit for carry forward of excess VAT.

The UAE Ministry of Finance has issued the Federal Decree-Law No. (16) of 2025, which amends certain provisions of Federal Decree-Law No. (8) of 2017 on Value Added Tax (“VAT”). The decree came into force on January 1, 2026.

The key changes are as under:

The amended law does not require businesses to issue self-invoices for transactions under the reverse charge mechanism. It is sufficient if businesses maintain standard supporting documentation, such as invoices, contracts, and transaction records.
Under the amended law, carry forward of excess VAT can be done for a period up to 5 years from the year in which the excess arose. Businesses will have to submit refund requests within five years period where the excess cannot be set off against the VAT liability.
Now, the law authorises the Federal Tax Authority (FTA) to deny the deduction of input tax if it determines that a supply is part of a tax-evasion arrangement. In addition, the amendments clarify the due diligence requirements that taxpayers must follow before claiming input tax deductions, ensuring greater accountability and alignment with international best practices.

Implication:
Businesses should take note of these VAT law changes and take proactive steps to ensure compliance.
They should monitor VAT refund/excess regularly.

UAE: Abu Dhabi introduces maternity leave support for Emirati mothers in private sector.

Abu Dhabi has launched a program allowing Emirati mothers working in private sector to claim maternity leave and financial support provided they meet the prescribed criteria. This initiative allows eligible mothers to enjoy up to 90 days of paid maternity leave with financial support of up to AED 15,000 per month.

Eligibility Criteria is as under:

Mother should be registered in the husband’s family book issued by the Emirate of Abu Dhabi.
Mothers should be employed in the UAE private sector.
They should obtain a no-objection certificate from the employer to extend maternity leave to 90 days.
They should make an application within 30 days after delivery, for births occurring after September 1, 2024, and provide the Emirates ID details of the newborn child.

Implication:
Employer should note the new maternity benefit and make necessary arrangements and changes in its system.

UAE: UAE introduces key amendments to the commercial company’s law effective from October 2025

The United Arab Emirates has issued Federal Decree-Law No. 20 of 2025, which amends certain provisions of Federal Decree-Law No. 32 of 2021 on Commercial Companies which came into effect in October 2025 (“Amendments”).

Key highlights of the amendments are as under:

The amended law provides clearer guidance on how the Commercial Companies Law applies to foreign companies with a UAE presence and to free zone entities conducting activities outside their free zones. While free zone companies continue to be governed by their own regulatory regimes within the free zone, they must comply with the Commercial Companies Law and other applicable federal laws when operating in the mainland, whether through a branch, representative office, or other form of presence. The amendments also clarify that free zone companies are considered UAE juridical persons under UAE law.
The amendment provides clarity on rules regarding appointment and resignation of managers and board of managers. The resignation will be considered to be effective if assembly does not act on it within 30 days subject to provisions in the memorandum of association. Companies would be required to notify the competent authority about the expiration of the term of the manager without appointment or renewal within 30 days. In case of expiry of term of board of managers without new appointment by assembly, the board is required to continue for up to 6 months period after which competent authority can appoint manager or board of managers.
One of the most significant changes under the amended law is the ability for companies to migrate, or continue, between jurisdictions within the UAE. Companies can now migrate from UAE free zones to the mainland and from the mainland into UAE free zones, while maintaining full legal continuity. This means companies can retain their legal personality, assets and liabilities, contracts, licences, and banking relationships throughout the migration process.
The amendments allow UAE LLCs to include drag-along, tag-along, and succession rights directly in their constitutional documents. This aligns UAE onshore companies with international practice and removes the need to rely solely on shareholders’ agreements. These changes help protect minority shareholders, simplify exits, and clearly regulate share transfers, including in the event of a shareholder’s death.
The amendments allow UAE limited liability companies (LLCs) to issue multiple classes of shares. LLCs may now issue shares with different voting rights, dividend entitlements, and other economic or governance rights. Previously, LLCs were allowed to issue only a single class of share, which restricted structuring flexibility. The amendments also allow private joint stock companies to undertake private placement subject to regulations in this regard.

Implication:
Companies should carefully review these amendments to assess their impact on existing and planned corporate structures.

United Kingdom

UK: UK government expands scope of enterprise management incentive scheme from April 6, 2026.

As part of the Autumn 2025 Budget, the government announced changes to the Enterprise Management Incentive (“EMI”) scheme that will take effect from April 6, 2026. The scheme allows taxation of gains as capital gains as against employment income and thus taxable at lower rates subject to meeting the specified conditions.

The key changes are as under:

For eligibility for EMI scheme, the following revised limits will apply –

Gross assets up to GBP 120 million (earlier GBP 30 million),
Employees count up to 500 (up from 250) and
value of shares GBP 6 million (up from GBP 3 million.

This will allow more companies to take advantage of EMI scheme.

The exercise period for EMI options will increase from 10 years to 15 years. This change can also apply retrospectively to existing EMI contracts that have not yet expired or been exercised.

Implication:
Employers should review their existing EMI arrangements and their eligibility for fresh arrangement.

UK: UK revises taxable benefit values for company cars and vans effective from April 6, 2026.

The UK government has increased the taxable benefits for company cars, vans, and fuel for the 2026/2027 tax year, vide Van Benefit and Car and Van Fuel Benefit Order (SI 2025/1254), dated December 1, 2025. It is relevant when employee is allowed to use company car or company vans for private use or when employer provides fuel for private mileage in company car and vans.

From April 6, 2026, the cash equivalent for fuel provided for a company car will rise to GBP 29,200 (up from GBP 28,200). The taxable benefit for van fuel will increase to GBP 798 (up from GBP 769), and the benefit for vans available for private use beyond ordinary commuting will rise to GBP 4,170 (up from GBP 4,020). Vans that emit no CO₂ and are used for private purposes will continue to have no taxable benefit.

Implication:
Employers should review company car and van arrangements to ensure payroll and tax reporting reflect the updated taxable benefit amounts from April 2026.

UK: UK national minimum wage and statutory pay rates to increase in April 2026.

Pursuant to changes in National Minimum Wage (“NMW”) and National Living Wage (“NLW”), effective April 1, 2026, statutory pay limits will rise. Statutory maternity, paternity, neonatal care, adoption, shared parental, and parental bereavement pay will increase to GBP 194.32 per week (up from GBP 187.18, a 3.8% increase). Statutory sick pay will rise to GBP 123.25 per week (up 3.8%). Lower Earning Limit will rise from GBP 125 to 129. These changes will take effect from April 6, 2026.

The National Living Wage for workers aged 21 and over will rise to GBP 12.71 per hour from April 1, 2026, while the NMW for 18–20-year-olds will increase to GBP 10.85 per hour.

Implication:
Employers should review their systems to accommodate the above updates.

UK: UK crypto assets reporting requirements become effective on January 1, 2026.

HMRC released high level guidance for crypto assets service providers on May 14, 2025, which has become effective on January 1, 2026, in consistent to OECD’s Crypto Assets Reporting Framework.

Under this guidance, the crypto asset service providers in UK are required to gather and report information about their users and crypto assets transactions.

The key features are as follows:

The obligation to report will apply to entities which transact in crypto assets on behalf of its users or provide means to its users such as platform, exchange, crypto wallet service, etc. Entities which are tax resident of UK or incorporated or managed or having branch of permanent establishment in UK will be considered as UK-based service providers who are subject to this reporting requirements.
The crypto assets service providers are required to report details of individual as well entity users. The details to be reported include individual’s or legal entity’s name, address, tax residential status, entity registration number and place of incorporation, etc. They also must report crypto assets transactions details such as type of crypto assets, transaction type, value of transaction, number of units transacted, etc.
Crypto asset service providers are required to start collecting the required information effective from January 1, 2026, while first reporting deadline will be May 31, 2027. The deadline to register with HMRC’s reporting portal is January 31, 2027.
The guidance also lay down penalties for failure by users to share information or failure to reporting information.
HMRC will share the information with foreign tax authorities where transactions involve non-UK resident users from participating jurisdictions.

Separately, UK Treasury has confirmed that crypto assets will come fully under the scope of existing financial services laws from October 2027.

Implication:
UK based crypto assets service provider should update their systems and processes to collect the necessary information so that they remain compliant with the new reporting requirement.

UK: UK’s Employment Rights Act introduces significant reform for modernizing workplace rights

The UK’s Employment Rights Bill received royal assent on December 18, 2025, becoming the Employment Rights Act 2025 (“ERA 2025”). Earlier, the Bill was approved in the House of Lords after an extended parliamentary process. It adds to and amends the existing legislation including Employment Rights Act, 1996.

Most of the changes made by the ERA will be implemented gradually over the next two years while a few changes will take effect immediately after the royal assent. The key provisions / changes are as under:

Zero hours workers – Businesses are required to offer guaranteed hours to workers employed on zero-hours or very low-hours contracts in cases where workers regularly work more hours than those stated in their contract. Employers will also need to give reasonable notice when the shifts fall outside normal working patterns. If a shift is cancelled at a short notice, the worker must be paid compensation. These changes will also apply to agency workers. The changes will come into effect in 2027 after the relevant rules are finalized and notified.
Flexible working – Under the existing law, employers can refuse flexible working requests based on one or more statutory grounds. The law now mandates the employers to demonstrate that the decision is reasonable the process was fair. Before refusing a request, employers are expected to discuss it with the employee explaining why it cannot be agreed. The government will be coming up with secondary legislation to lay down the process after consultation on this topic. The changes would take effect in 2027.
Unfair dismissal – From January 1, 2027, the eligibility to make unfair dismissal claim will be based on completion of six months of service, instead of earlier requirement of two years of service. The current unfair dismissal compensation cap (of either 52 weeks’ gross salary or GBP118,223, whichever is lower) may be removed.
Fire and Rehire – Dismissal will be considered as unfair if it is based on employee’s refusal of certain changes to their contract, such as pay, hours, leave, pensions, or shift patterns, or if the employer plans to replace them with someone on different terms to do the same job. Employers can only justify such dismissals if they can show serious financial difficulties and that the changes were essential, backed by clear evidence. Law also introduces a new anti-avoidance rule whereby dismissing employee to replace them with a non-employee in the same role will automatically constitute as unfair dismissal. These changes are expected to take effect in October 2026 after the government revises relevant code of practice after due consultation.
Protection from harassment – Since October 2024, employers have been required to take “reasonable steps” to prevent sexual harassment at work. The regulations are expected to define what constitute reasonable steps which are likely to be implemented in 2027. The law will require employers to take all reasonable steps effective from October 2026. Employers will also be responsible for harassment by third parties, such as customers or clients, unless they have taken all reasonable measures to prevent it. Reporting sexual harassment will be protected under whistleblowing rules and rules for safeguarding employees from unfair dismissal or other detriment. The protection will be effective from April 2026.
Eligibility for leave and pay – From the first day of employment, workers will be entitled to paternity leave, parental leave, and bereavement leave including for pregnancy loss before 24 weeks. The provisions relating to bereavement leave will take effect in 2027 after due consultation on eligibility and circumstances for taking it while day-one paternity and unpaid parental leave will come into effect from April 2026. Further, statutory sick pay will be available from day one of sickness and waiting period will be removed. Further, eligibility requirement to earn at least equal to lower earnings limit has been removed. These changes will apply from April 2026.
Non-disclosure agreement – The Act will ban non-disclosure agreements (NDAs) that stop workers from reporting harassment or discrimination, including how their complaints were handled by the employer. The government has not yet announced when this ban will come into effect.
Employment tribunal claim –The time limit for making most Employment Tribunal claims (excluding breach of contract) will increase from three months to six months. This change is expected to take effect in October 2026.

Implication:
Employers should monitor developments in this respect and update their processes and systems to remain compliant with the new law. Day one right for parental, paternity and bereavement leave will necessitate changes to HR policies. Changes relating to sick leave and pay need to be updated in HR policies. Reduction in minimum service period from 2 years to 6 months for unfair dismissal claim can have substantial impact.

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