Make the first Pillar Two filing the start of a standing entity data pipeline.
The first GloBE Information Return cycle closed on 30 June 2026, and it left most groups holding something more valuable than the filing itself: a complete, jurisdiction tagged picture of every constituent entity. The opportunity now is to keep that as a living part of the ERP rather than a workbook that has to be rebuilt.
Thesis
The filing was the deadline. The entity data is the asset.
To produce a GloBE Information Return, a group has to state, with precision, which legal entities it contains, where each of them is resident for tax, who owns whom and in what proportion, and how the financial results of each one roll up by jurisdiction. Many groups had never had to assemble all of that in one place, to one standard, at one moment in time. For the 30 June 2026 deadline, they did.
That work is the most reusable thing the cycle produced. Statutory consolidation, transfer pricing documentation, country-by-country reporting, intercompany eliminations, and legal entity rationalisation all draw on the same underlying facts. A group that turns the filing pack into governed master data gets those benefits every period, not once every eighteen months.
The timing is favourable, too. The next return arrives on a shorter cadence, and the transitional safe harbour has been extended by a year. That combination is exactly the window in which a data pipeline is worth building.
Where the rules stand, and why operators should care.
The first cycle has now closed
For groups with a calendar fiscal year, the 2024 GloBE Information Return fell due on 30 June 2026. The transition-year deadline is 18 months after the end of the fiscal year, and it shortens to 15 months for every year after that.
The next return is closer than the last one. A 31 December 2025 year end puts the second GIR at the end of March 2027, so the interval between filings is shorter than the interval most teams just used to prepare.
Scope is genuinely multi-jurisdictional
EY counts nearly 40 jurisdictions requiring filings related to the 2024 tax year, with 37 having global minimum tax rules effective from that year.
This is a group-consolidation problem before it is a tax problem. Entity data has to be complete and consistent across every jurisdiction where a constituent entity sits, not only where a tax return is filed.
The return is a machine-readable schema
The GIR is filed against the OECD GloBE Information Return XML schema, published in January 2025, and exchanged between administrations under the Multilateral Competent Authority Agreement on the Exchange of GloBE Information.
A schema-based filing rewards structured source data. Anything assembled by hand has to be re-assembled by hand next time, while anything mapped once to the schema can be regenerated.
Central filing relief is conditional
On 18 May 2026 the OECD released a common understanding on GIR central filing. Where a group files centrally in a listed jurisdiction by the deadline and files the local GIR notification, participating jurisdictions can waive penalties or avoid enforcing local filing.
The relief depends on the group knowing exactly which entities sit in which jurisdiction, and on filing notifications locally. That is entity master data doing compliance work.
Not every jurisdiction joined
Per EY, the Bahamas, North Macedonia, the Slovak Republic and Vietnam did not join the common understanding, and Greece and Poland joined only in respect of EU member states on the annex.
Blanket assumptions do not survive. The group needs a per-jurisdiction view of filing route and relief status, maintained as data rather than remembered by one person.
The transitional safe harbour gained a year
The OECD's side-by-side package, agreed on 5 January 2026, extended the transitional CbCR safe harbour by one year, to fiscal years beginning on or before 31 December 2027 and not ending after 30 June 2029, with the 17 percent transitional ETR threshold used for 2026 also applying to 2027.
This is the useful part of the news. Groups leaning on country-by-country data for relief have one more cycle to build the full GloBE computation properly rather than under deadline pressure.
A permanent simplification is arriving
The same package introduced a Simplified ETR safe harbour, to be made available for fiscal years beginning on or after 31 December 2026, alongside the side-by-side, ultimate parent entity, and substance-based tax incentive safe harbours.
Safe harbours reduce computation, not data. Each one still has to be tested per jurisdiction, and the test itself is evidence a reviewer will want to see.
Data Model
Make the entity register a system of record.
The central design decision is where the constituent entity list lives. In many groups it is assembled for each filing from the consolidation hierarchy, a company secretarial register, and a few emails. That produces a correct answer once and no durable record of how it was reached.
Promoting it to master data changes the economics. Effective dating means an entity acquired in February and one disposed of in September are both represented correctly without a manual note. An approval trail means the reviewer can see what changed since the last cycle rather than re-checking everything.
Jurisdiction deserves the same treatment. Where it is inferred from an entity naming convention or a reporting hierarchy, it is fragile. Stored explicitly on the entity and carried onto ledger balances, it becomes the dimension every jurisdictional blend groups by.
Constituent entity register
Treat the list of constituent entities as a governed master data object with an owner and a change history, rather than a spreadsheet rebuilt each cycle from the consolidation hierarchy.
Evidence to retain
Entity ID, legal name, tax jurisdiction, entity type, GloBE status, excluded-entity basis, date entered and left the group, approver, source system.
Ownership and control chain
Model ownership as time-sliced percentages between entities, since allocation of top-up tax follows the chain and the chain moves during the year.
Evidence to retain
Parent entity, subsidiary entity, ownership percentage, control flag, effective from, effective to, restructuring reference, evidence document.
Jurisdiction tagging of financial data
Tag ledger balances with the jurisdiction of the constituent entity that produced them, so jurisdictional blending is a query rather than an offline mapping exercise.
Evidence to retain
Ledger account, entity ID, jurisdiction code, reporting currency, functional currency, translation rate, consolidation adjustment reference.
Covered taxes and adjustments
Keep current and deferred tax by entity with the GloBE adjustments identified separately, so the same figures can support both the accounting close and the return.
Evidence to retain
Entity ID, current tax, deferred tax, adjustment type, GloBE reference, source journal, preparer, reviewer, calculation version.
Safe harbour test results
Store the outcome of each safe harbour test per jurisdiction per year, with the inputs used, rather than only the conclusion that no top-up tax arose.
Evidence to retain
Jurisdiction, fiscal year, test applied, revenue and profit inputs, threshold rate used, simplified ETR result, substance-based exclusion amount, pass or fail, evidence link.
Filing and notification ledger
Record where the GIR was filed, which jurisdictions received it by exchange, and where a local notification was lodged, as a standing register.
Evidence to retain
Jurisdiction, filing route, central filing jurisdiction, notification date, submission reference, acknowledgement, relief basis, responsible owner.
Put the control where the jurisdiction is decided.
A GloBE return is a set of assertions to multiple tax administrations, exchanged between them under a multilateral agreement. It deserves the traceability a group already applies to a consolidation journal: which entities contributed, which ownership position applied on which dates, which version of the computation produced the figure, and who reviewed it before submission.
Safe harbour testing is the part most worth instrumenting. A jurisdiction that cleared the de minimis or simplified effective tax rate test this year may not clear it next year, and the threshold rate itself has stepped up over the transitional period. If the inputs are retained alongside the result, next year is a recalculation. If only the conclusion was kept, next year is a reconstruction.
The extension of the transitional safe harbour is the practical gift here. It converts a compliance scramble into a planned build, and it lets a group sequence the work by risk, starting with the jurisdictions most likely to need a full computation first.
Implementation checklist
1. Capture what the first filing actually used
While the 2024 return is still fresh, record where each number came from. The mapping from source system to return field is the single most valuable artefact the cycle produced, and it decays quickly.
2. Promote the entity register into the ERP
Move the constituent entity list out of the working file and into governed master data, with an owner, effective dating, and a change approval path.
3. Make jurisdiction a first-class ledger attribute
Where jurisdiction is derived from an entity code at reporting time, store it explicitly instead. It is the dimension every GloBE calculation groups by.
4. Retain safe harbour inputs, not just outcomes
A jurisdiction that passed on the de minimis or simplified ETR test this year may not next year. Keeping the inputs makes the following year a recalculation rather than a rebuild.
5. Use the extra year deliberately
The transitional safe harbour now runs a year longer. Pick the jurisdictions most likely to fall out of it first and build the full GloBE computation for those while relief still applies.
6. Dry run the second return early
Generate a draft GIR from the pipeline against the half-year position. A schema validation failure found in autumn is configuration work; the same failure in March is an escalation.
Constructive failure modes to design around.
The entity list lives in the filing pack
Give the constituent entity register a home in master data with an owner. A list that exists only inside last cycle’s workbook has to be rebuilt and re-reviewed every year.
Ownership is captured as a point in time
Store ownership percentages with effective dates. Mid-year acquisitions and internal reorganisations change allocation, and a single year-end snapshot cannot express that.
Jurisdiction is inferred from a naming convention
Promote jurisdiction to an explicit attribute on the entity and on the ledger. Convention-based inference works until an entity is renamed or redomiciled.
Safe harbour relief is treated as permanent
The transitional CbCR safe harbour now runs to fiscal years beginning on or before 31 December 2027 and not ending after 30 June 2029. Plan the full computation for the jurisdictions that will need it first.
Filing route is held as institutional memory
Keep filing route, notification status, and relief basis per jurisdiction as data. Coverage under the common understanding varies, and several jurisdictions stayed outside it.
Return data never returns to the close
Feed the GloBE figures back into the group close so the tax charge, the disclosure, and the return draw on the same numbers, with one reconciliation rather than three versions.
API and event-design considerations.
A group reporting pipeline should expose events such as entity.registered, ownership.changed, jurisdiction.assigned, period.blended, safe_harbour.tested, gir.validated, and filing.acknowledged.
Each event should carry entity, jurisdiction, fiscal year, effective dates, computation version, actor, timestamp, and idempotency key. The case worth designing for explicitly is restatement: a prior-year adjustment or a late acquisition accounting entry can move a jurisdictional result after a return has already been filed and exchanged.
The output is a small sub-ledger of entity, ownership, and jurisdiction decisions sitting alongside the consolidation. That is what turns the next return into a regenerated extract rather than a project with its own calendar.
Example GloBE evidence payload
{
"globe_evidence_id": "gir_fy2025_jur_ie",
"fiscal_year": "2025",
"jurisdiction": "IE",
"constituent_entities": [
{ "entity_id": "ce_00214", "type": "operating", "entered_group": "2019-04-01" },
{ "entity_id": "ce_00871", "type": "holding", "entered_group": "2025-02-14" }
],
"ownership_slices": [
{ "parent": "ce_00012", "child": "ce_00871", "pct": 100.0, "from": "2025-02-14" }
],
"safe_harbour_test": {
"test": "transitional_cbcr_simplified_etr",
"threshold_rate_pct": 17.0,
"inputs_source": "qualified_cbc_report_fy2025",
"result": "pass",
"recompute_required_next_year": true
},
"filing": {
"route": "central",
"central_filing_jurisdiction": "IE",
"local_notification_filed": true,
"schema_version": "GIR XML v1.0",
"validated": true
},
"controls": {
"preparer": "group_tax_manager",
"reviewer": "group_controller",
"reviewed_on": "2026-07-22",
"auditor_packet_ready": true
}
}Questions CFOs and controllers should ask ERP and tax vendors.
Practical Takeaway
A well-timed window to build once and file repeatedly.
The near-term work is well bounded: capture how the first return was actually built, promote the constituent entity register into governed master data, make jurisdiction an explicit ledger attribute, retain safe harbour inputs alongside results, and dry run the second return against a half-year position. None of that requires a system replacement, and all of it is cheaper while the first cycle is still in living memory.
For ERP buyers, this is a clean architecture test. A platform that treats legal entity, ownership, and jurisdiction as governed, effective-dated master data will absorb the next group reporting obligation as configuration. One that holds them as reporting-time derivations will need a rebuild each time the perimeter or the rules move, which over a multi-year global minimum tax regime is a recurring cost with no offsetting benefit.
Sources
- OECD: GloBE Information Return (Pillar Two) XML Schema, user guide for tax administrations
- OECD: Safe Harbours and Penalty Relief, Global Anti-Base Erosion Rules (Pillar Two)
- OECD: Multilateral Competent Authority Agreement on the Exchange of GloBE Information
- EY: Why Pillar Two compliance demands focus as a major filing deadline looms
- EY: OECD releases common understanding on GIR central filing and updates to administrative guidance under Pillar Two
- KPMG UK: OECD administrative guidance in relation to the 'side-by-side' package
- Mayer Brown: OECD Pillar Two side-by-side system and new safe harbors
- Forvis Mazars: OECD eases GloBE filing concerns