Company: FRHC
Filing Date: 2025-07-29
Form Type: ARS
Source: 0000924805-25-000027
Chunk: 179

Company: Freedom Holding Corp.
Filing Date: 2025-07-29
Form: ARS
Chunk 179
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. Undertaxed Payments Rule (UTPR) – Serves as a backstop where IIR is not applied, allocating top-up tax to jurisdictions where other group entities are located. 3. Qualified Domestic Minimum Top-up Tax (QDMTT) – Optional domestic implementation by a jurisdiction to retain top-up tax at the local level. These rules are generally effective from 2024 (IIR), with UTPR and QDMTT effective from 2025, subject to jurisdiction- specific legislation. As of March 31, 2025, Pillar 2 rules have been legislated in the following jurisdictions where the Group operates: • Germany • United Kingdom • Turkey • Cyprus • United Arab Emirates (UAE) The IIR is in effect from January 1, 2024, in these countries. UTPR and QDMTT will generally apply from 2025. Notably, the UAE has implemented only the QDMTT under the GloBE framework, effective from January 1, 2025. The Pillar two law of Cyprus provides for an IIR practically as from 2024, a UTPR practically as from 2025, and a domestic minimum top-up tax as from 2025. Transitional Safe Harbor Rules Table of Contents FREEDOM HOLDING CORP. NOTES TO AUDITED CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 2024 (All amounts in thousands of United States dollars, except share data, unless otherwise stated) 113

To reduce initial compliance burdens, the OECD introduced Transitional Safe Harbor Rules (Annex A to the Administrative Guidance, Dec 2022), applicable for fiscal years beginning on or before December 31, 2026 (but not after June 30, 2028). A jurisdictional safe harbor is met if one of the following tests is satisfied: • De Minimis Test – Jurisdictional revenue < EUR 10 million and Profit (Loss) Before Tax < EUR 1 million • Simplified ETR Test – Simplified covered taxes ÷ PBT > 15% • Routine Profits Test – PBT ≤ routine profits based on the Substance-Based Income Exclusion (SBIE) formula Based on FY 2025 results, assessments indicate that all jurisdictions except Kazakhstan and Cyprus qualify for at least one of the safe harbor tests. In this regard, notwithstanding Kazakhstan, Uzbekistan, Azerbaijan, and Armenia have not yet enacted Pillar 2 legislation. However, low-taxed constituent entities in these jurisdictions may be