The December 2022 Safe Harbour and Penalty Relief Guidance provided for a Simplified Calculations Safe Harbour. The aim being to reduce or simplify the number of computations and adjustments an MNE is required to make under the GloBE Rules.
The only simplified calculations that have currently been developed by the OECD are the Non-Material Constituent Entity (NMCE) Simplified Calculations.
A number of jurisdictions already include the Simplified Calculations Safe Harbour in their GloBE legislation (see our Pillar Two GloBE Guides), including:
– Austria
– Bulgaria
– Germany
– Ireland
– Luxembourg
– Romania
– UK
The December 2023 OECD Administrative Guidance provides further information on the NMCE Simplified Calculations (for the Simplified Calculations Safe Harbour).
NMCEs are constituent entities of an MNE Group that are not consolidated on a line-by-line basis in the MNE Group’s audited consolidated financial statements solely for size or materiality grounds. It also includes any permanent establishments of these entities (providing the Main Entity is itself an NMCE.)
It should be noted that an entity will only be considered a NMCE if an external auditor has agreed that the entity does not meet the materiality standards and has been excluded from the consolidation process on those grounds.
Where an entity’s revenue exceeds EUR 50 million, the entity will only be an NMCE if its financial accounts are prepared in accordance with an Acceptable Financial Accounting Standard or an Authorised Financial Accounting Standard.
Given the significant practical difficulties MNEs may have in obtaining accurate reporting figures for NMCEs (as they aren’t included in the consolidated accounts), NMCEs can benefit from the following simplifications:
– The GloBE revenue and GloBE income of an NMCE is the total revenue of the NMCE as determined in accordance with the relevant CbC regulations.
– The adjusted covered tax of a NMCE is the income tax accrued as determined in accordance with the relevant CbC regulations (note that this excludes any deferred tax expenses, adjustments for non-current items and provisions for uncertain tax liabilities).
Relevant CbC Regulations are the Country-by-Country Reporting Regulations of the UPE Jurisdiction or of the surrogate parent entity jurisdiction if a Country-by-Country Report is not filed in the UPE Jurisdiction.
If the UPE jurisdiction does not have CbC requirements and an MNE Group is not required to file a CbC Report in any jurisdiction, Relevant CbC
Regulations are the OECD BEPS Action 13 Final Report and the OECD Guidance on the Implementation of Country-by-Country Reporting.
These simplified figures are then used for three tests under the Simplified Calculations Safe Harbour.
On October 2, 2025, Hungary released the 2025 Autumn Tax Package. This includes some amendments to the operation of the Transitional CbCR Safe Harbour.
On October 15, 2025, Hungary issued the draft Advance QDMTT Tax Declaration (Form 24GLBADO) as well as filing instructions and a draft XML guide.
On October 10, 2025, Belgium issued a Draft Law to amend its Minimum Tax Act. There are a number of technical amendments (which don’t effect the Minimum Tax calculation), the correction of an error in the original text as well as administrative amendments.
On October 3, 2025 Normative Instruction RFB No. 2282, of October 2, 2025 was published in the Official Gazette. This includes amendments to Brazil’s DMT Law for the OECD June 2024 OECD Administrative Guidance and other sundry amendments.
On October 5, 2025, Israel published a consultation on a draft law for a domestic minimum tax (intended to be a Qualified Domestic Minimum Top-Up Tax or ‘QDMTT’) from January 1, 2026.
On October 3, 2025, Turkey published the Draft Communique on the Minimum Tax Law, and the Draft GIR, for consultation. Whilst Turkey has enacted its Minimum Tax Law, a lot of the detailed application of the GloBE rules was left to a further Regulation. This Communique therefore provides for the detailed rules for the implementation of the GloBE rules in Turkey.
On September 18, 2025, Croatia opened a consultation on a Draft Bill to amend its Minimum Tax Act. The amendments are primarily to amend the QDMTT accounting standard so that the Croatian QDMTT qualifies for the QDMTT Safe Harbour and to provide for the notification deadline for appointing a designated filing entity.
On September 26, 2025, Hong Kong updated its Pillar 2 guidance to include information on its Pillar 2 Portal, applications for Group Codes and mandatory e-filing of profit tax returns for Pillar 2 groups.
On September 29, 2025, the Federal Ministry of Finance opened a consultation on a Draft Regulation for the implementation of the Minimum Tax Act. This provides for compliance rules for the exchange of the GIR and simplified reporting.
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