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Data Points for Pillar Two Corporate Structures

The GloBE Information Return will require information on an MNEs corporate structure in so far as it impacts the application of the Pillar Two GloBE rules. 
 
In this article we look at the data points that are required to comply with this.
 
Existing group structures will need significant analysis to comply with the GloBE Rules as a number of the data points rely on a solid analysis and application of the rules.
 
As such existing group structures will need to be reviewed in light of the GloBE rules to establish which entities are constituent entities, Joint Ventures, jurisdictions where there is a qualifying income inclusion rule (IIR)/under-taxed payments rule (UTPR), excluded entities, intermediate parent entities, POPE’s, hybrid entities as well as GloBE exemptions eg the initial activity exemption.
 
Changes Relating to the Group Structure
 
If there are changes to the group structure that impacts on the GloBE allocation (eg ownership of a constituent entity passes to a POPE or a parent jurisdiction begins to apply a qualifying IIR) this would need to be reported. 
 
Therefore whilst existing data points relevant to the group structure may well be in place and relatively easy to identify, going forwards these will need to be assessed from a GloBE perspective. In addition, there will need to be monitoring to identify whether a relevant jurisdiction applies a qualifying IIR, UTPR or qualifying domestic minimum top-up tax (see our Pillar Two Tracker). 
 
Where there are no changes during the year (after the first year) there is likely to be a reduced reporting requirement for the corporate structure elements.

Data Points

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Picture of Lee Hadnum

Lee Hadnum

Lee is a qualified Chartered Accountant and Chartered Tax Adviser. A former Senior Tax Analyst at Bloomberg Tax, Lee began his career in Ernst & Young's Entrepreneurial Services department and has 20 years of international tax planning experience. Lee's books have been recommended by The Times, The Guardian and The Telegraph.

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