Pillar Two Accounting Update

The Government has amended Accounting Standard 22 to address the global tax reform under the OECD Pillar Two framework. Under the amendment, companies are not required to recognise or disclose deferred tax assets or liabilities arising from Pillar Two taxes. 

However, companies must separately disclose their current tax expenses and provide information on potential exposure to these taxes. 

The disclosure requirements apply to financial reporting periods beginning on or after 1 April 2025. These changes align Indian accounting standards with evolving international tax reforms.