What payments count as base erosion payments?

Base erosion payments include deductible payments to foreign related parties: royalties, management fees, service fees, and interest. Cost of goods sold is generally excluded. Depreciation on property acquired from related parties is included.

What is the BEAT rate?

BEAT rate is 10% (12.5% for large banks) on 'modified taxable income' (regular taxable income plus base erosion payments). The BEAT liability is the excess of BEAT tax over regular tax liability. Very few companies trigger BEAT above the 3% threshold.

BEAT Base Erosion Percentage >3% Test Calculator

Determine whether a US corporation is subject to the Base Erosion and Anti-Abuse Tax (BEAT) by calculating the base erosion percentage: base erosion payments / total deductions. Threshold is 3% (2% for banks).

Statute of Limitations

Incident / Event Date

Claim Type

⚖ For informational purposes only. Not legal advice. Consult a licensed attorney for your specific situation.

How to Use

Enter the values for the scenario you are assessing. Determine whether a US corporation is subject to the Base Erosion and Anti-Abuse Tax (BEAT) by calculating the base erosion percentage: base erosion payments / total deductions. Threshold is 3% (2% for banks). Use the beat test result to inform your calculation.

BEAT Base Erosion Percentage >3% Test Calculator

Statute of Limitations

How to Use

Frequently Asked Questions

What payments count as base erosion payments?

What is the BEAT rate?