PwC | OECD Inclusive Framework Pillar Two Package Addresses Consistency of Rule Application and Reporting

What happened? 

The OECD/G20 Inclusive Framework (IF) on 11 September 2026 released a package of Pillar Two materials, including a revised GloBE Information Return (GIR), a framework for the full legislative review of jurisdictions’ Pillar Two rules, and Administrative Guidance on certain conditional taxes and issues with respect to Qualified Domestic Minimum Top-up Taxes (QDMTT) fiscal-period mismatches.

The revised GIR implements reporting changes arising from the January 2026 Side-by-Side (SbS) Package. For qualifying US-parented groups applying the SbS safe harbour, certain Income Inclusion Rule (IIR) and Undertaxed Profits Rule (UTPR) reporting is reduced, although QDMTT reporting generally remains. Following the IF release, US Treasury separately welcomed the revised GIR.

Why is it relevant?  

The released package affects several aspects of Pillar Two implementation. The revised GIR implements the SbS reporting changes and will require another XML transition. The full legislative review introduces more detailed review of jurisdictions currently operating under transitional qualified status, including a process for taxpayers to identify potential inconsistencies in domestic implementation. The Administrative Guidance could affect whether certain domestic taxes count toward a jurisdiction’s GloBE Effective Tax Rate (ETR) and how the QDMTT safe harbour applies when local and group fiscal periods do not align.

Actions to consider  

Multinational enterprise (MNE) groups should assess how the revised GIR and safe harbours affect their reporting obligations, including continuing requirements in QDMTT jurisdictions, and prepare for the forthcoming XML schema. Businesses also should monitor legislative reviews in relevant jurisdictions and consider providing stakeholder input where domestic rules differ from the GloBE framework. Groups potentially subject to conditional taxes should assess the new Covered Tax guidance.

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