Pillar 2 Dashboard: Ireland

On October 16, 2025, Ireland published its 2025 Finance Bill. This includes amendments for the January 2025 OECD Administrative Guidance, DAC 9 implementation as well as other technical amendments.

On October 25, 2024, the Ministry of Finance issued S.I. No. 551/2024 – Taxes Consolidation Act 1997 (Section 111B(3)) Order 2024 to provide for the application of the June 2024 OECD Administrative Guidance.

On October 10, 2024, Ireland published its 2024 Finance Bill. In the Bill, a number of amendments are made to the Global Minimum Tax provisions. This was approved by the lower house of Parliament on November 5, 2024 and signed into law by the President on November 12, 2024.

On August 8, 2024, the Irish Revenue issued eBrief No. 213/24 concerning new guidance on the administration of the Pillar 2 global minimum tax, as well as updated guidance on the operation of the Pillar 2 rules.

On December 22, 2023, the Minister of Finance issued
S.I. No. 675/2023 – Taxes Consolidation Act 1997 (Section 111B(3)) Order 2023 to provide that the December 2023 OECD Adminstrative Guidance applies in Ireland.

On December 18, 2023, the Irish President enacted the Finance (No. 2) Act 2023 (Act 39 of 2023) to implement the EU Minimum Tax Directive.

On October 19, 2023, the Irish Ministry of Finance released the Finance (No. 2) Bill 2023. This inserts a new Part 4A into the Taxes Consolidation Act, 1997 to implement the Pillar Two GloBE rules/EU Minimum Tax Directive.

On July 27, 2023, Ireland issued its Second Feedback Statement on Pillar Two.

On March 31, 2023, the Irish government issued a Feedback Statement on the Pillar Two Global Minimum Tax.

It includes draft legislation and outlines possible draft legislative approaches to key elements of the GloBE Rules.

General

In line with the EU Directive, the Law applies an Income Inclusion Rule (IIR) from fiscal years commencing on or after 31 December 2023, and the Under-Taxed Profits Rule for fiscal years commencing on or after 31 December 2024.

The Law provides for the comprehensive implementation of the GloBE Rules and follows two previous Feedback Statements (July, 2023 and March, 2023).

Section 111AAE of the Law provides that Ireland will apply a domestic minimum top-up tax (intended to be a QDMTT) for financial years beginning on or after December 31, 2023.

The Law specifically provides that for the purpose of calculating and administering the GloBE rules in Ireland the domestic law is to be construed so as to ensure, as far as practicable, consistency with the OECD Model Rules and OECD guidance providing it is not inconsistent with the EU Directive.

The OECD guidance is comprehensively detailed in the Law (including the OECD Commentary, Safe Harbours and Penalty Relief Guidance, February and July 2023 Administrative Guidance, Examples and the GIR Guidance.

Further guidance issued by the OECD (eg the December 2023 Administrative Guidance) can also be include as ‘OECD guidance’ for this purpose by an Order of the Minister of Finance. As such  S.I. No. 675/2023 – Taxes Consolidation Act 1997 (Section 111B(3)) Order 2023 issued on December 22, 2023 treats the December 2023 OECD Administrative Guidance as guidance for the purposes of Irelands domestic rules.  

On October 25, 2024, the Ministry of Finance issued S.I. No. 551/2024 – Taxes Consolidation Act 1997 (Section 111B(3)) Order 2024 to provide for the application of the June 2024 OECD Administrative Guidance.

The Finance Act 2024, includes as OECD Guidance the Examples to the GloBE Model Rules issued on April 25, 2024. The Finance Bill 2025, updates this to the OECD Examples issued on May 9, 2025 and also includes the January 2025 OECD GIR Guidance. 

As expected, the Law closely follows the EU Directive. There are very few options given to member states in the EU Directive in terms of flexibility over national implementation.

As noted below, most aspects of the First or Second Set of OECD Administrative Guidance are included in the Law.

Administrative Guidance

Aspects of the First Set of OECD Administrative Guidance included in the Law are:

– Currency Conversion Rules (Article 1.1)

– Forex hedge election (Article 2.2)

– Excluded Dividends – Asymmetric treatment of dividends and distributions (Article 2.3)

– Debt release election (Article 2.4)

– Accrued Pension Expenses (Article 2.5)

– Excess negative tax carry-forward guidance (Article 2.7)

– Substitute Loss carry forwards (Article 2.8)

– Equity Gain or loss inclusion election (Article 2.9)

– Allocation of taxes arising under a Blended CFC Tax Regimes (Article 2.10)

– The extension of the taxable distribution method election to insurance investment entities (Article 3.1)

– Exclusion of Insurance Investment Entities from the definition of Intermediate Parent Entity and Partially-Owned Parent Entity (Article 3.2)

– Restricted Tier 1 Capital (Article 3.3)

– Liabilities related to Excluded Dividends and Excluded Equity Gain or Loss from securities held on behalf of policyholders (Article 3.4)

– Portfolio shareholding election (Article 3.5)

– Additional rules (such as the deemed 50% requirement where employees perform work outside the employer’s jurisdiction for the SBIE).

Therefore, certain elements of the OECD Administrative Guidance are not specifically included in the Law but should be applicable under the general interpretative provision, including:

– Sovereign wealth funds and the definition of Ultimate Parent Entity (Article 1.4)

– Clarifying the definition of ‘Excluded Entity’ (Article 1.5)

– Meaning of “ancillary” for Non-Profit Organisations (Article 1.6);

– Application of Tax transparency election to Mutual insurance companies (Article 3.6).

They may, however, be included in future regulations.

Aspects of the Second Set of OECD Administrative Guidance included in the Law are:

– Currency Conversion Rules (Article 1)

– Tax Credits Guidance (MTTCs) (Article 2)

– SBIE Rules

       – foreign rules (Article 3)

       – Stock-based compensation election

       – Leases (Article 3)

– QDMTT Safe Harbour (Article 4.1)

– UTPR Safe Harbour (Article 4.2)

The Third and Fourth Set of OECD Administrative Guidance is included in the Law due to the implementation of S.I. No. 675/2023 – Taxes Consolidation Act 1997 (Section 111B(3)) Order 2023 and S.I. No. 551/2024 – Taxes Consolidation Act 1997 (Section 111B(3)) Order 2024.

However, the Finance Act 2024 specifically legislates for a number of aspects of the Third Set of OECD Administrative Guidance (see below) and the Fourth Set of OECD Administrative Guidance. This includes:

– Aggregate DTL Category basis (Article 1.2.1)

– Exclusion of certain types of GL accounts and separate tracking (Article 1.2.1)

– Exclusion of GL accounts that generate standalone DTAs (Article 1.2.1)

– Exclusion of swinging accounts and separate tracking (Article 1.2.1)

– FIFO/LIFO Basis (Article 1.2.2)

– Recalculated deferred tax where GloBE carrying value differs from accounting carrying value (Article 2.1.2)

– Five-Year Election to exclude the allocation of all deferred tax expenses and benefits to CFCs, PEs, Hybrids and Rev Hybrids (Article 4.2.2)

– Determining GloBE status when a Flow-through Entity is held directly by another Flow-through Entity (Article 5.2.2)

-Hybrid entities – Entities located in jurisdictions without a Corporate Income Tax system (Article 5.5.3)

– Extension of taxes pushed down to include Reverse Hybrids (Article 5.6.2)

– Option to not impose top-up tax liabilities on SPVs used in securitization transactions (Article 6.1.4)

– Amendments to the Switch-Off rule (Article 6.1.4)

– New definition: Securitization Entity (Article 6.1.4)

– New definition: Securitization Arrangement (Article 6.1.4)

The Finance Act 2024 amendments have differing commencement dates. The amendments relating to securitization entities, for instance, apply from December 31, 2023, whereas the amendments for deferred tax tracking apply from December 31, 2024.

Section 92 of the Finance Bill 2025 includes the deferred tax recognition amendments to Articles 9.1 of the GloBE Rules in the January 2025 OECD Administrative Guidance (including the grace period for DTA reversals). The consequential amendments to the Transitional CbCR Harbour and the QDMTT Safe Harbour are also included.

Safe Harbour and Penalty Relief Guidance

QDMTT Safe Harbour

Section 5.1 of the Second Set of OECD Administrative Guidance includes a QDMTT Safe Harbour Election.

The QDMTT Safe Harbour excludes the application of the GloBE Rules in the UK by deeming the Top-up Tax payable under the GloBE Rules to be nil where top-up tax is levied under a foreign QDMTT.  The MNE Group therefore only needs to undertake one calculation.

Section 111AI of the Law includes this and is in accordance with the OECD Administrative Guidance. In particular it applies a ‘Switch-Off Rule’ that prevents an MNE Group from applying the safe harbour to all or some Constituent Entities located or created in the QDMTT jurisdiction and requires the MNE Group to switch to the general credit method for the offset of the QDMTT.

This applies where:

 – A QDMTT jurisdiction decides not to impose a QDMTT on Flow-through Entities created in its jurisdiction;

 – A QDMTT jurisdiction decides not to impose a QDMTT on Investment Entities subject to Articles 7.4, 7.5, and 7.6 of the GloBE Rules (Provisions for the Effective Tax Rate Computation for Investment Entities, Investment Entity Tax Transparency Election, or the Taxable Distribution Method Election);

 – A QDMTT jurisdiction decides to adopt the UTPR exclusion for MNEs in their initial phase of international activity; or

 – A QDMTT jurisdiction includes members of a JV Group (which includes Joint Ventures) within the scope of the QDMTT but imposes the liability on Constituent Entities of the main group instead of directly on the members of the JV Group.

Finance Act 2024 amends Section 111AI(4) of the primary law to amend the Switch-off rule so that QDMTTs that impose the top-up tax liability computed for a Securitisation Entity on other Constituent Entities located in the jurisdiction or that exclude Securitisation Entities from the scope of the tax would both still meet the Consistency Standard.

Section 92 of the Finance Bill 2025 amends Section 111AI(4) of the primary law to amend the Switch-off rule for the deferred tax recognition amendments to Articles 9.1 of the GloBE Rules in the January 2025 OECD Administrative Guidance.

Transitional UTPR Safe Harbour

A new Section 111AK in the Law includes the Transitional UTPR Safe Harbour, as provided in the July 2023 OECD Administrative Guidance.

This deems the UTPR Top-up Tax amount for a UPE Jurisdiction to be zero if the UPE Jurisdiction has a corporate income tax rate of at least 20 percent.

It applies for Fiscal Years which begin on or before 31 December 2025 and end before 31 December 2026.

The aim is to provide additional time for jurisdictions to assess the impact of the GloBE rules and reform their existing corporate income tax so that top-up tax won’t apply or to introduce a qualified domestic minimum tax such as a Domestic IIR or QDMTT.

Transitional CbCR Safe Harbour

This is included in Section 111AJ and ties in with the OECD Safe Harbour and Penalty Relief Guidance.

The S.I. No. 675/2023 – Taxes Consolidation Act 1997 (Section 111B(3)) Order 2023 transposes the amendments to the Transitional CbCR Safe Harbour in the December 2023 OECD Administrative Guidance.

However, to leave no doubt over the application, the Finance Act 2024 specifically legislates for a number of aspects to ensure they are included in the primary legislation. This includes:

– Transitional CbCR – Purchase Accounting Adjustments (consistent reporting condition, goodwill impairment adjustment) (Article 1)
– Transitional CbCR – MNEs not required to file CbC Reports (Article 2.3.4)
– Transitional CbCR – Treatment of Taxes on income of PEs, CFCs, and Hybrid Entities (Article 2.4.2)
– Transitional CbCR – Treatment of hybrid arbitrage arrangements (Article 2.6)

NMCE Safe Harbour

Whilst the S.I. No. 675/2023 – Taxes Consolidation Act 1997 (Section 111B(3)) Order 2023 transposes the December 2023 OECD Administrative Guidance into domestic law (which includes the NMCE Safe Harbour), the Finance Act 2024 specifically legislates for this in a new Section 111AKA in the law.

Transitional Reporting Election

Section 111AAAC of the Law includes a transitional reporting election, which may change the reporting requirements for the information contained within the GIR for all members in a territory for which the election is made.

It can only apply for accounting periods that begin on or before 31 December 2028 and end before 1 July 2030.

One of the following conditions would need to be met:

1. none of the members in the territory have top-up amounts or additional top-up amounts for the accounting period to which the election is to apply.
2. there is only one entity responsible for all of the members in the territory for the accounting period to which the election is to apply, and the total amounts attributed to that entity for that period in respect of those members’ top-up amounts and additional top-up amounts is equal to the total of the members’ top-up amount and additional top-up amounts.
3. there is more than one entity responsible for the members of the group in the territory for the accounting period to which the election is to apply, and each entity is responsible for every member of the group in the territory and has the same inclusion ratio for each member it is responsible for.

Elections in the OECD Model Rules

All of the elections included in the OECD Model Rules and the EU Minimum Tax Directive are provided in the Law, including:

– Excluded Entity Election (Section 111C(3) of the Law)

– Stock-Based Compensation Election (Section 111P(3) of the Law)

– Election to use the Realization Method (Section 111P(6) of the Law)

– Election to Spread Capital Gains (Section 111P(7) of the Law)

– Consolidation Election (Section 111P(9) of the Law)

– Unclaimed Accrual Election (Section 111X(1) of the Law)

– GloBE Loss Election (Section 111Y of the Law)

– Prior Year Adjustment Election (Section 111AB of the Law)

– De minimis Election (Section 111AG of the Law)

– Substance-Based Income Exclusion Election (Section 111AE(3) of the Law)

– Taxable Distribution Election (Section 111AV of the Law)

– Tax Transparency Election (Section 111AU of the Law)

– Distribution Tax Regime Election (Section 111AS of the Law)

Elections included in the OECD Administrative Guidance included in the Law are the:

– Equity Investment Inclusion Election (Section 111W of the Law);

– Excess Negative Tax Carry-Forward Election (111U(9) of the Law);

– Debt Release Election (111P(16) of the Law);

– Foreign Exchange Hedge Election (111P(13) of the Law);

– Portfolio Shareholding Election (111P(14) of the Law);

– Five-Year Election to exclude the allocation of all deferred tax expenses and benefits to CFCs, PEs, Hybrids and Reverse Hybrids (111Z(9) of the Law)

Differences to Model Rules

As provided in the EU Minimum Tax Directive, the Law includes a UTPR from 2025. Ireland’s approach is to apply a UTPR top-up tax rather than a denial of deduction.

As such the carry forward provisions in Article 2.4.2 of the Model Rules for UTPR amounts not sufficient to provide for the additional cash tax expense is not relevant and these rules are not included in the Law.

The 2025 Finance Bill includes a new Section 111N(1)(c) in the Law to provides that where all of the constituent entities of an MNE group consent, the UTPR top-up tax amount may be allocated to the domestic constituent entities for a fiscal year in a manner agreed between all of the domestic constituent entities.

The Law includes many of the additional rules that have been published in the OECD Administrative Guidance. These are not included in the OECD Model Rules but are part of the GloBE framework. 

For example:

The Law addresses substitute loss carry forwards. This reflects Article 2.8 of the OECD Administrative Guidance that provides for the inclusion of deferred tax in the GloBE deferred tax adjustment amount for ‘Substitute Loss Carry Forwards’.

The Law provides for the Carry-forward of Excess Negative Tax Expenses. As an alternative to incurring additional top-up tax when a domestic tax loss exceeds the GloBE loss, Article 2.7 of the OECD Administrative Guidance provides that an MNE can elect for the Excess Negative Tax Expense administrative procedure.  The law implements these provisions.

The Law applies specific provisions for Blended CFC Regimes (which reflects the OECD Administrative Guidance and includes a simplified formula to allocate CFC taxes in blended CFC regimes such as GILTI for fiscal years that begin on or before 31 December 2025 but not ending after 30 June 2027).

Many aspects of the June 2024 OECD Administrative Guidance are included in the Finance Act 2024 (see above). However, certain aspects, including the 5-year unclaimed accrual election, are not included.

Qualifying Domestic Minimum Top-Up Tax (QDMTT)

Section 111AAE of the Law provides that Ireland will apply a domestic minimum top-up tax (intended to be a QDMTT) for financial years beginning on or after December 31, 2023.

The QDMTT applies to both MNE groups, domestic groups and stand-alone entities (ie no group is required). The Finance Act 2024 provides that a standalone investment undertaking is not chargeable to the QDMTT.

Section 111AAD of the Law provides that the standard GloBE calculation rules for determining the top-up tax, but they are then subject to a number of adjustments. The adjustments include:

Amended Top-Up Tax Calculation

Section 111AD(2)(b) of the Law amends the standard top-up tax calculation so that the determination of the QDMTT payable does not itself require the deduction of QDMTT (which would include an element of circularity).

Eligible Distribution Tax Systems

Section 111AD(2)(c) of the Law excludes references to Eligible Distribution Tax Systems as they are not included domestically

Accounting Standard

Section 111AD(2)(e) of the Law states that the QDMTT is calculated based on the local financial accounting standard, if all domestic group members keep their accounting records based on the local financial accounting standard and:

– All the domestic group members are required to prepare or use the statements for the purposes of determining their liability to tax in the State or to comply with any other law of the State, or

– The financial statements are subject to an external financial audit.

Taxes Pushed-Down

Tax paid or incurred by a Constituent Entity-owner under a CFC Tax Regime that is pushed down to a domestic Constituent Entity in the GloBE Rules must be excluded, as provided in the OECD Administrative Guidance. This is included in Section 111AD(2)(f) of the Law.

This preserves Ireland’s primary right to tax income accruing to an Irish member entity which is also a CFC. If there were no statutory derogation from the general GloBE rules for the calculation of the domestic minimum tax, and the CFC tax paid by the controlling company abroad were included in the included taxes of the Irish CFC, the effective tax rate would be increased. Therefore, excluding the CFC tax from the Irish CFCs covered taxes allows Ireland to tax low-taxed income at a higher rate than would be the case under an IIR.

Section 111AD(2)(f)/(g)/(h) also prevents the pushdown of tax to hybrids, PEs and for taxes on distributions (aside from Irish withholding tax on distributions). Section 115(g) of the Finance Act 2024 extends the pushdown restriction to include reverse hybrid entities.

The Finance Act 2024 provides for a new Section 111AAD(8) which states that a hybrid entity or reverse hybrid entity is allocated the amount of any covered taxes included in the financial accounts of its constituent entity-owner where the taxes:

-are allocated to the qualifying entity under Art 4.3.2(d) of the OECD Model rules,

-are imposed by the jurisdiction in which the constituent entity is located, and

-relate to the income of the qualifying entity.

This is therefore an exclusion from the QDMTT pushdown restriction for taxes imposed by a QDMTT jurisdiction itself on a direct or indirect Constituent Entity-owner’s share of income of a hybrid/ Reverse Hybrid Entity created in the QDMTT jurisdiction. This ties in with the June 2024 OECD Administrative Guidance and is effective from December 31, 2024.

Ownership Interests

Section 111AD(2)(i) of the Law provides that top-up tax under a QDMTT in respect of Joint Ventures is the whole amount irrespective of the fact that the UPE would only be subject to tax on its share of the Top-up Tax arising from Joint Ventures or JV subsidiaries.

Currency

The Second set of OECD Administrative Guidance provides that where not all Constituent Entities in the jurisdiction use the local currency as their functional currency, the Filing Constituent Entity may make a Five-Year Election to undertake the QDMTT computations for all Constituent Entities in the jurisdiction either:

– in the presentation currency of the Consolidated Financial Statements; or

– in the local currency.

This is also provided in Section 111AAAA(4) of the Law.

Securitisation Entities

The Finance Act 2024 includes a new Section 111AAC(4) in the primary law to implement the June 2024 OECD Administrative Guidance for securitisation entities.

It provides for the domestic top-up tax liability in respect of a securitisation entity to be imposed on another constituent entity of the MNE group or, where the top-up tax liability cannot be otherwise collected, on the securitisation entity itself. The 2025 Finance Bill includes a further amendment to provide that any QDMTT calculated for a securitisation entity that is a minority-owned constituent entity will be allocated to other group members.

The relevant aspects of the submission of a GloBE Information Return (GIR) are included, as provided in the EU Directive.

The proposed approach is that every Constituent Entity located in Ireland will have an obligation to file a GIR in Ireland. However, this obligation can be discharged if the GIR is filed by:

– The Ultimate Parent Entity, or

– The Designated Filing Entity.

Where the GIR is being filed by either the Ultimate Parent Entity or the Designated Filing Entity, the Constituent Entity, must file a notification with the Revenue.

The notification must contain:

– Details of the entity that is filing the GIR, and

– The jurisdiction in which such an entity is located.

Where the GIR is filed by the Designated Local Entity it needs to outline the Constituent Entities that it is filing on behalf of.

Both the GIR and associated notifications must be filed no later than 15 months after the end of the fiscal year (with an 18-month deadline for the Transition Year).

Article 111AAS of the Law also requires payment of top-up tax by the filing deadline.

As well as the GIR, the Law requires the submission of an IIR Return, UTPR Return or QDMTT Return (all by the GIR filing deadline).

Section 92 of the 2025 Finance Bill provides for the implementation of DAC 9 and the OECD Pillar Two MCAA for GIR filing.

Penalties

Section 111AAAB of the Law provides for a late filing penalty of 10,000 Euros per month (up to 48 months)

Registration

Section 111AAH of the Law provides that an Irish entity subject to top-up tax (either under the IIR or UTPR) is required to notify the tax authority within 12 months from the the last day of the first fiscal year during which it is a relevant parent entity, immediately following a fiscal year for which it was not a relevant parent entity.

Amended Section 111AAH of the Finance Act 2024 provides that the registration date is December 31, 2025, where the registration date is earlier than 31 December 2025.

The registration is a “once off” registration (i.e. it would not be required annually).

There will also be a requirement to de-register when a Constituent Entity falls out of scope of the GloBE rules. The deadline for this will be 12 months after the end of the first Fiscal Year in which the entity is no longer in scope.

The information to be provided at registration would be :

-Name of the Constituent Entity.
-Tax reference number of the Constituent Entity.
-The name of the MNE group.
-The Ultimate Parent Entity of the group and its location as per the GloBE rules.
-If appropriate, the Designated Filing Entity and its location.
-A local contact person.
-The first Fiscal Year for which the group is in scope
-The date on which the accounting period of the group normally ends.
-If appropriate, the name and tax reference number of the Designated Local Entity, including confirmation that it has been nominated by the other Constituent Entities to act as such.
-If a Designated Local Entity, the names and tax reference numbers of the Constituent Entities for which it has been appointed the Designated Local Entity and confirmation that it has been nominated by the Constituent Entities to act as such.

On September 8, 2025, Ireland released Revenue eBrief No. 170/25 with detailed information on the registration process.

On August 15, 2025, Ireland opened its Pillar 2 Hub. This provides details on filing and registration. Registration is now possible online via the Revenue Online Service (ROS).