Kuwait's Domestic Minimum Top-up Tax (DMTT) has created a significant new compliance requirement for multinational enterprise groups operating in the country.
The regime applies for fiscal years beginning on or after 1 January 2025 to qualifying multinational groups with annual global revenues of at least EUR 750 million in at least two of the previous four fiscal years, subject to the applicable rules.
As businesses progress through the first compliance cycle, attention should turn to the processes that support the calculation, reporting and documentation requirements.
What should multinational groups review?
Affected groups should confirm that all relevant Kuwait entities are correctly identified within their Pillar Two framework, registered with the tax authorities and that local responsibilities are clearly assigned.
The underlying financial information required for DMTT calculations should be mapped and reconciled with group-level Pillar Two data.
Businesses should also review related-party transactions, applicable adjustments and elections, supporting documentation and the governance process for preparing, reviewing and approving calculations.
Consistency between the Kuwait position and the group's broader Pillar Two approach will be particularly important for businesses operating across several jurisdictions.
Why does the regional picture matter?
Kuwait is one of several Middle East markets where Pillar Two is becoming an operational compliance issue. In April 2026, Kuwait issued a circular to facilitate optional advanced DMTT payment applicable to tax periods ending on or before 31 March 2026.
Bahrain has published detailed guidance for its DMTT return process, while Qatar launched Pillar Two registration through Dhareeba in August 2026.
At the same time, businesses in the UAE and Oman are preparing for e-invoicing implementation, while Saudi Arabia's current Tax Amnesty window creates a separate year-end priority.
Group tax teams should consider these requirements together when planning resources and compliance calendars.
What should Kuwait businesses do now?
In-scope multinational groups should use the current period to validate entity registrations and classifications, data sources, calculation methodology, documentation, including transfer pricing documentation, and local-to-group reporting processes.
How BDO Kuwait can help
BDO Kuwait helps multinational groups understand their DMTT obligations, assess their current compliance framework and identify areas requiring further preparation.
How confident are you that your Kuwait DMTT process can move from calculation to compliant reporting?
Speak to our Kuwait tax professionals to review your current readiness.