Pillar Two GloBE Readiness Assessment Template (OECD, EU DAC9)

Pillar Two GloBE Readiness Assessment: [Group name] FY[YYYY]

Readiness assessment and work plan for the global minimum tax (Pillar Two) of a multinational group: scope test, jurisdiction implementation status (IIR, UTPR, QDMTT), safe harbour assessment, data map for GloBE income, covered taxes and the substance-based income exclusion, GloBE Information Return (GIR) filing approach, systems, deferred tax and provision effects, timeline, owners and risks. Based on the OECD Global Anti-Base Erosion Model Rules (Pillar Two) and their Administrative Guidance, including the Side-by-Side Package approved by the Inclusive Framework on 2026-01-05, and on Council Directive (EU) 2022/2523 and Council Directive (EU) 2025/872 (DAC9), as published at 2026-10. Replace every [bracketed] value and every row marked Example. This is a document format, not tax, legal, accounting or financial advice. Obtain the Model Rules, the Administrative Guidance and each domestic law for the normative text.

Document control

Approvals

Revision history

Contents

• 1. Scope and group structure
• 2. Jurisdiction implementation status
• 3. Safe harbour assessment
• 4. Data map: GloBE income, covered taxes and SBIE
• 5. Full computation for jurisdictions without a safe harbour
• 6. GIR content and filing approach
• 7. Systems, controls and XML schema
• 8. Deferred tax, provision and disclosure impacts
• 9. Timeline and owners
• 10. Risks, issues and open questions
• 11. Glossary and references
• Standard and licence note

1. Scope and group structure

The GloBE Rules apply to constituent entities of a multinational group whose annual revenue in the consolidated financial statements of the ultimate parent entity was EUR 750 million or more in at least two of the four fiscal years immediately before the tested year (Model Rules Article 1.1; EU Directive 2022/2523 Article 2). Record the four-year test from the audited consolidated accounts, adjust for short or long fiscal years as the rules require, and keep the evidence with the assessment.

1.1 Revenue threshold test

Example: Ostrander Group N.V. first met the threshold in FY2023 and FY2024, so it is in scope for the fiscal year starting 2025-01-01. The FY2024 test (FY2020 to FY2023) used only one qualifying year, so the group was outside scope for FY2024 and had no FY2024 GIR to file. FY2025 is therefore the first GloBE year. Under Model Rules Articles 8.1.6 and 9.4.1, and the matching filing and transitional provisions of EU Directive 2022/2523 (Article 44 and the transitional rules), the first GIR is due no later than 18 months after the end of the first fiscal year in scope; for FY2025 that is 2027-06-30. Confirm in each jurisdiction that the "first year" extension applies to the group's first year in scope and not only to fiscal year 2024.

1.2 Constituent entities

Map every legal entity in the consolidation perimeter, plus permanent establishments, which the rules treat as separate constituent entities. Flag joint ventures, minority-owned entities, investment entities, flow through entities and stateless entities, because each has special rules. Reconcile the list to the legal entity register and to Table 2 of the CbC report: differences between the two lists are the most common source of GIR errors.

1.3 Group structure

Draw the legal ownership chain from the UPE to every constituent entity, including intermediate holding companies and permanent establishments.

2. Jurisdiction implementation status

Pillar Two has three charging mechanisms. A qualified domestic minimum top-up tax (QDMTT) lets the source jurisdiction collect the top-up tax on low-taxed local profits first. The income inclusion rule (IIR) lets the parent jurisdiction collect any remaining top-up tax of low-taxed subsidiaries. The undertaxed profits rule (UTPR) is the backstop that allocates residual top-up tax to other jurisdictions where the group operates. Status depends on domestic law, not on the Model Rules, so record the legal basis and the effective date for each jurisdiction.

Status as of 2026-10; check local law and the OECD Central Record before relying on any row. "From FY2024" means fiscal years beginning on or after 2023-12-31; "From FY2025" means fiscal years beginning on or after 2024-12-31. EU Member States implement the IIR and UTPR through Directive 2022/2523; Article 50 lets a Member State with few in-scope parent groups postpone the IIR and UTPR, so check whether any EU jurisdiction in your structure used that option.

The United States has not enacted Pillar Two rules. Under the Side-by-Side Package, a group whose UPE is in a jurisdiction listed on the Central Record as having a qualified side-by-side regime can elect a safe harbour that switches off the IIR and UTPR, while QDMTTs still apply everywhere. For a US-parented group, check the Central Record for the current listing; for Ostrander, whose UPE is Dutch, the US is only a source jurisdiction with no QDMTT, so any top-up tax for the US subsidiary would be collected under the Dutch IIR.

The OECD released a common understanding on central filing of the GIR on 2026-05-18. Jurisdictions that joined it agreed not to penalise groups that filed the GIR centrally in a listed jurisdiction and made the local notification, while bilateral exchange relationships are activated. As of 2026-05-12 several jurisdictions, including Vietnam, had not joined, so plan a local filing there unless local guidance says otherwise.

3. Safe harbour assessment

Four families of safe harbours matter for fiscal years up to 2027. List each one, the years it covers, and whether the group can use it.

Under the TCSH, the transition rate for the simplified ETR test is 15% for fiscal years beginning in 2023 and 2024, 16% for 2025, and 17% for 2026 and 2027. The de minimis test requires CbC revenue below EUR 10m and profit before tax below EUR 1m in the jurisdiction. The routine profits test passes when profit before tax does not exceed the substance-based income exclusion computed for the jurisdiction. A jurisdiction that fails all tests in a year cannot use the TCSH in a later year, so record the first failure carefully.

3.1 TCSH results for FY2025

Inputs come from the qualifying CbC report (EUR m). Simplified covered taxes are the income tax expense in the qualified financial statements, excluding non-covered taxes and uncertain tax positions.

Check: revenues 743.0 + 191.0 + 137.0 + 205.0 + 122.0 = 1,398.0; profit before tax 58.47 + 5.70 + 4.10 + 3.03 + 8.70 = 80.00; taxes 16.10 + 1.76

• 1.06 + 0.76 + 0.91 = 20.59; Vietnam ETR 0.91 / 8.70 = 10.46%.

Example: CbC revenue follows the same basis as the Country-by-Country Report Workpaper (finance/country-by-country-report-workpaper): unrelated plus related-party revenue, before eliminations. Total CbC revenue of EUR 1,398.0m includes EUR 578.0m of intra-group revenue (OST-NL sales, service charges and interest to subsidiaries 470.0; OST-VN development fee 108.0), which reconciles to consolidated revenue of EUR 820.0m. Vietnam fails the ETR test because Ostrander Vietnam Co., Ltd applies a preferential corporate income tax rate of 10% for qualifying software production (a rate incentive under Vietnamese law; check the current incentive law and the entity's eligibility). It fails the de minimis test because its revenue is above EUR 10m. It passes the routine profits test, because profit before tax of EUR 8.70m does not exceed the SBIE of EUR 8.90m (section 4.3): a labour-intensive cost-plus service centre earns little more than its substance carve-out. The margin is only EUR 0.20m, so treat the pass as fragile and keep the full computation in section 5 as a shadow calculation. The same test passes again in FY2026 by EUR 0.06m (CbCR workpaper section 9.3). If Vietnam ever fails all three tests, it can never use the TCSH again.

Review each "Pass" for robustness: a pass based on a 16% threshold with a margin of under two percentage points can turn into a fail in a later year when the transition rate rises to 17%. Keep a margin column in the working file and alert the head of tax when the margin falls below the alert level set in section 10.

4. Data map: GloBE income, covered taxes and SBIE

GloBE computations start from the financial accounting net income or loss of each constituent entity as used to prepare the UPE's consolidated accounts, before intra-group eliminations. Adjustments then convert it to GloBE income or loss. Covered taxes start from the current and deferred tax expense in the same accounts and are adjusted, including the recast of deferred tax at the 15% minimum rate. The substance-based income exclusion (SBIE) uses payroll costs of eligible employees and the carrying value of eligible tangible assets in the jurisdiction.

4.1 Data elements

Mark each gap with an action in section 9. A gap rated "Yes" means the data does not exist today; "Partial" means it exists but is not tagged or not at the needed granularity. Document how each manual adjustment is calculated, who reviews it, and how it ties back to the ledger.

4.2 Covered taxes

Covered taxes include taxes on income or profits, taxes in lieu of a generally applicable income tax, and taxes on retained earnings and corporate equity. They exclude top-up tax under a qualified IIR, UTPR or QDMTT, and certain other items. Build the covered tax figure per constituent entity from the tax provision workpapers, and show the bridge from the total tax expense in the accounts to adjusted covered taxes. Uncertain tax positions recorded in the accounts are excluded until paid, so the provision workpaper must tag them separately (see Income Tax Provision, finance/income-tax-provision).

4.3 Substance-based income exclusion

The SBIE equals a payroll carve-out plus a tangible asset carve-out. After the transition period both rates are 5%. During the transition, higher rates set in Model Rules Article 9.2 apply and decline each year; check the rate table for the fiscal year being computed.

$\text{SBIE} = r_{\text{payroll}} \times \text{Eligible payroll costs} + r_{\text{assets}} \times \text{Eligible tangible assets}$

Example: For Vietnam, 80.00 x 9.6% = 7.680 and 16.00 x 7.6% = 1.216, so the SBIE is 8.896. Vietnam's payroll is large relative to its profit because OST-VN employs about 2,900 engineers and support staff (FY2026 personnel cost EUR 86.4m in the Transfer Pricing Local File, finance/transfer-pricing-local-file). The FY2026 rates fall to 9.4% and 7.4%, and to 9.2% and 7.2% in FY2027, so the carve-out shrinks every year unless payroll grows; model the routine profits margin forward at each budget cycle.

5. Full computation for jurisdictions without a safe harbour

For each jurisdiction that fails every safe harbour, compute the jurisdictional effective tax rate, the top-up tax percentage, the excess profit and the top-up tax. The minimum rate is 15%. Run the same computation as a shadow calculation for any jurisdiction that passes a safe harbour by a thin margin, so the exposure is known before the margin is lost.

$\text{ETR} = \frac{\text{Adjusted covered taxes}}{\text{Net GloBE income}}$

$\text{Top-up tax \%} = \max(0,\ 15\% - \text{ETR})$

$\text{Jurisdictional top-up tax} = \text{Top-up tax \%} \times (\text{Net GloBE income} - \text{SBIE}) + \text{Additional top-up tax} - \text{QDMTT payable}$

Example: 7.79 + 0.91 + 0.40 = 9.10; 0.91 / 9.10 = 10.0%; 9.10 - 8.896 = 0.204; 5.0% x 0.204 = 0.0102, about EUR 10k. Because Vietnam passes the TCSH routine profits test for FY2025, its top-up tax is deemed zero and nothing is payable; the shadow figure is the fallback if the safe harbour is lost (for example if the CbC report turned out not to be qualified). It also shows why the CbC test and the full computation can differ: the GloBE adjustments in C3 raise the income compared with CbC profit before tax. If the safe harbour is lost and the Vietnamese QDMTT is listed as qualifying for the QDMTT safe harbour, the Dutch IIR top-up tax for Vietnam is deemed zero without a second computation; if it is not listed, the group computes under the Dutch IIR and credits the QDMTT. Vietnam also fails the GloBE de minimis exclusion because average GloBE revenue is above EUR 10m.

From FY2026, review whether the Substance-based Tax Incentive Safe Harbour changes the result. A reduced statutory rate is not the same as an expenditure-based incentive, so the preliminary view for Vietnam is that the safe harbour gives no relief (Example); confirm with the current Administrative Guidance and a local adviser. The size of the exposure if every safe harbour is lost can be estimated from the shadow computation: at a 10% rate the top-up tax percentage is about 5%, applied to profit above the SBIE.

6. GIR content and filing approach

The GloBE Information Return is a standard return developed by the Inclusive Framework. It has a general section on the group and the filing entity, a corporate structure section, a summary of results by jurisdiction, and detailed jurisdictional sections covering safe harbour elections, ETR computations, top-up tax and its allocation. Check the current GIR version and XML schema published by the OECD and the local version adopted by each jurisdiction before building the filing.

The GIR is due no later than 15 months after the end of the fiscal year, extended to 18 months for the first year. For calendar-year groups in scope for FY2024, the first GIR was due on 2026-06-30. Within the EU, Directive 2022/2523 Article 44 sets the filing obligation, and Directive 2025/872 (DAC9, adopted 2025-04-14) lets the designated filing entity file centrally with one Member State, which then exchanges the relevant parts with the others. Commission Implementing Regulation (EU) 2025/1325 sets the exchange forms and formats.

Keep a filing log with submission references, the XML file hash, the schema version used and acknowledgement receipts. Domestic QDMTT returns are separate from the GIR in many jurisdictions and can have their own earlier deadlines and payment dates.

7. Systems, controls and XML schema

Choose the calculation engine after mapping the data. Small groups often use a controlled spreadsheet for a few years, but the GIR's XML format and the number of data points push most groups to a tool linked to the consolidation system. Whatever the tool, version it, lock formulas, document every manual override, and keep the inputs and outputs for at least the local record retention period. Treat the Pillar Two computation as a key report in the internal control framework, because it drives a tax liability and a financial statement disclosure.

8. Deferred tax, provision and disclosure impacts

Under IFRS, IAS 12 as amended in May 2023 (International Tax Reform: Pillar Two Model Rules) gives a mandatory temporary exception from recognising and disclosing deferred tax related to Pillar Two income taxes (paragraph 4A) and requires specific disclosures (paragraphs 88A to 88D). Under US GAAP, ASC 740 applies; groups generally treat top-up taxes as period costs rather than remeasuring deferred taxes. Obtain the standards for the normative text and agree the policy with the auditor.

The provision process must collect Pillar Two estimates at each reporting date, including interim periods, because the top-up tax is a current tax of the year. Link the numbers in this section to the Income Tax Provision (finance/income-tax-provision), where the FY2026 Pillar Two result (zero, Vietnam passing the routine profits test by EUR 0.06m) is documented in section 8.

9. Timeline and owners

Review the plan monthly in the tax steering meeting. Move an action to "Done" only with evidence attached, and record any change of deadline in the revision history.

10. Risks, issues and open questions

Open questions to resolve with advisers: the local filing route in each jurisdiction that has not joined the central filing understanding; the treatment of any new incentive under the Substance-based Tax Incentive Safe Harbour; whether the Simplified ETR Safe Harbour will be available early (from fiscal years beginning on or after 2025-12-31) in every jurisdiction with taxing rights; and the effect of any change in the OECD Central Record on side-by-side status for groups with a parent in a listed jurisdiction.

11. Glossary and references

11.1 Glossary

11.2 References

Standard and licence note

Based on the OECD Global Anti-Base Erosion Model Rules (Pillar Two), the related Administrative Guidance and the Side-by-Side Package (OECD, 2026, licensed under CC BY 4.0), and on Council Directive (EU) 2022/2523 and Council Directive (EU) 2025/872 (EUR-Lex, reuse with acknowledgement). This is an adaptation of original works by the OECD: the opinions expressed and arguments employed in this adaptation should not be reported as representing the official views of the OECD or of its Member countries, and the OECD does not endorse this template. IAS 12 and ASC 740 are cited by name and paragraph or topic number only; no text from IFRS Foundation or FASB material is reproduced. The template text is original. Ostrander Group N.V. and every figure are fictional. Check the current official versions of the Model Rules, Administrative Guidance, GIR, Central Record and each domestic law before use. Template licence: MIT.