The first round of BEPS Pillar Two filings is complete. A clearer picture is now emerging of what compliance actually demands in practice, and it differs in several respects from what many multinational enterprise groups (MNEs) expected.
The observations below draw on experience from the first filing cycle. They are organised around the expectations MNEs brought to the process and the realities they encountered.
Safe harbours do not remove the compliance burden
Many groups approached safe harbours as a near-exemption. In practice, safe harbours can materially reduce the need for full GloBE calculations in qualifying jurisdictions, but they do not eliminate compliance work. Groups must still confirm eligibility, validate source data, make the relevant elections, retain supporting documentation, and meet applicable GIR, notification and local return requirements.
The practical lesson is to treat safe harbour eligibility as a simplified pathway, not an exit from Pillar Two. Eligibility must be tested and documented jurisdiction by jurisdiction.
Central governance is necessary but not sufficient
Many groups adopted a centralised approach, expecting head office to manage Pillar Two for the whole group. Local teams have nonetheless played a material role in supporting reporting, notifications and jurisdiction-specific requirements. A centrally governed but locally supported operating model, with clearly defined responsibilities across global, regional and jurisdictional teams, proved more workable than pure centralisation.
Nil top-up tax does not mean nil obligations
A common misconception was that Pillar Two only matters where top-up tax is actually payable. Many organisations discovered that registrations, notifications and local self-assessment returns were still required even where no top-up tax arose. Pillar Two is, at its core, a compliance reporting framework. A nil tax outcome does not extinguish filing obligations.
Data collection takes far longer than expected
Gathering the required financial, tax and entity-level information involved multiple stakeholders and took longer than most groups anticipated. The challenge extended well beyond the calculation engine. Data had to be extracted from multiple systems, transformed, validated, reconciled and converted into GIR XML and jurisdiction-specific filing formats. Groups that waited until close to the deadline found themselves under significant pressure.
Beginning data collection, obligation scoping and technical analysis well before the deadline is essential to accommodate reviews, approvals and validation issues.
Statutory accounts are a starting point, not the finish line
Statutory accounts are an important foundation, but they rarely contain all the information Pillar Two requires in the form it requires it. Additional adjustments, entity classifications, deferred tax information, ownership data, elections, CbCR information and reconciliations are typically needed. Source data may also require modification before it qualifies for safe harbour or GIR purposes.
Local rules diverge materially from the OECD framework
The OECD framework provides a common foundation, but domestic implementation varies considerably. Differences arise in legislation, filing dates, registration requirements, form design, payment requirements, data fields, portal processes and the treatment of domestic minimum taxes. Some jurisdictions require information that the OECD calculation does not expressly demand. Groups need to understand both the global framework and each local set of requirements separately.
This complexity was compounded by the fact that filing forms, electronic portals, central filing arrangements and local guidance were still being finalised in some jurisdictions close to the June 2025 deadline. The OECD and a number of tax administrations introduced transitional relief and administrative flexibility in response to practical difficulties during this first cycle.
Pillar Two is a cross-functional exercise
Tax teams lead the technical analysis, but the reporting process depends on information and decisions from finance, statutory reporting, consolidation, IT, data management, legal, treasury and local teams. Technology specialists and data owners are most effective when involved from the outset rather than brought in at the filing stage.
The first filing is not a repeatable template
The first cycle generated useful templates and institutional experience. It is not, however, a fixed model that can simply be rolled forward. Safe harbour rules, UTPR application, domestic legislation, XML schema requirements, forms and filing systems continue to evolve. Changes in later years may alter both the calculations and the information required.
The appropriate response is to convert the first-year project into a sustainable annual operating model, with controlled roll-forward procedures, documented positions and ongoing monitoring of OECD and jurisdictional developments.
The operational last mile
Across all of these lessons, the hardest part of first-round compliance was managing the operational last mile: identifying every applicable obligation, collecting and reconciling data from multiple systems, translating calculation results into jurisdiction-specific forms, validating XML files, obtaining approvals, and coordinating central tax teams, local finance teams and technology providers.
Technology can reduce repetitive work, support validation and provide visibility over global filing obligations. It does not remove the need for technical judgement, documented positions and robust review controls.
The first-round experience has moved the conversation from preparation to sustained management of a live compliance framework. MNE groups are best served by treating that experience as the foundation for a repeatable, governed process rather than a one-off project.