APTV · 10-Q · 2026Q3 · Full report

OECD Global Minimum Tax

Aptiv PLC · 2026-11-03 · Importance 40 · Surprise 42

On January 15, 2025, the OECD issued Administrative Guidance amending the Pillar Two Framework, which provides for a minimum effective tax rate of 15% in adopting jurisdictions. The Guidance eliminates the tax basis of certain deferred tax assets, including tax credit carryforwards, and Aptiv no longer expects significant benefits from the tax incentive granted to its Swiss subsidiary in 2023. Aptiv recognized a $294 million increase to valuation allowances in 2025 to reduce the related deferred tax asset; the Guidance did not affect other deferred tax assets.

Key facts

• Aptiv recognized a $294 million increase to valuation allowances in 2025 after it no longer expected significant benefits from the tax incentive granted to its Swiss subsidiary. source
• On December 18, 2025, the Swiss Council of States passed a motion preventing retroactive application of the OECD’s 2025 Guidance; Aptiv stated this had no immediate impact on its tax position and would continue monitoring potential implications for recoverability of Swiss deferred tax assets associated with its Swiss tax incentive. source
• The OECD’s January 15, 2025 Guidance eliminated tax basis in certain deferred tax assets, including tax-credit carryforwards, for purposes of the global minimum tax, which generally provides for a 15% minimum effective tax rate. source