Company: PATH
Filing Date: 2025-09-08
Form Type: 10-Q
Source: 0001734722-25-000043
Chunk: 73

Company: UiPath, Inc.
Filing Date: 2025-09-08
Form: 10-Q
Item: Part I, Item 1
Chunk 73
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 2022. In addition, we have engaged in two bilateral transfer pricing negotiations for our transfer pricing model, one between the U.S. and Romania, and one between Japan and Romania. The U.S.-Romania negotiation is in its final stage, and we anticipate that an agreement will be reached in the next six months. During the three months ended July 31, 2025, after evaluating recent developments, we recorded a $3.1 million decrease to the U.S. DTA and the corresponding valuation allowance, representing the unrecognized tax benefit related to the U.S.-Romania bilateral advance agreement. Further, during the three months ended July 31, 2025 we also recorded a $4.3 million increase in the Romania DTA and the corresponding valuation allowance. The Japan-Romania negotiation is currently ongoing, and the ultimate outcome remains uncertain.On December 20, 2021, the Organization for Economic Co-operation and Development ("OECD") published the Pillar Two Model Rules defining the global minimum tax for multinational enterprises with an annual revenue above €750.0 million. The OECD has since issued administrative guidance providing transition and safe harbor rules around the implementation of the Pillar Two global minimum tax. Based on the current Pillar Two rules, we anticipate a qualified domestic minimum top-up tax ("QDMTT") of $1.9 million in Romania for the current fiscal year. The impact of the QDMTT was included when calculating the estimated annual effective tax rate for the current year. In June 2025, the G7 countries reached an understanding that U.S.-based parent groups would be excluded from the income inclusion rules and undertaxed profit rule under the OECD Pillar Two framework. The G7 understanding has not been implemented in the OECD framework or in local legislation. We are currently assessing the impact of the G7 understanding but do not expect a significant impact on our effective tax rate in the current year.On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was signed into law, resulting in significant changes to the U.S. federal income tax code, including restoring the 100% bonus depreciation deduction for qualified property, allowing the immediate expensing of domestic research and experimental expenditures, and causing various changes to other domestic and international tax provisions. ASC 740, Income Taxes, requires that the effects of changes in tax rates and laws to be recognized in the period in which the legislation is enacted. We have 

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