How to Complete and File the GloBE Information Return (GIR)

The GloBE Information Return is the standardized filing that large multinational groups use to report jurisdictional income and taxes under the OECD/G20 Pillar Two framework, and it must be prepared by any multinational enterprise (MNE) group with consolidated annual revenue of at least €750 million in two of the four preceding fiscal years.¹ The return demonstrates compliance with the 15% global minimum effective tax rate. For groups whose fiscal year ended December 31, 2024, the first return is due by June 30, 2026.²

Which Groups Are In Scope

The rules pick up any MNE group whose consolidated financial statements show €750 million or more in annual revenue in at least two of the four fiscal years immediately before the reporting year.¹ Purely domestic groups fall outside the scope, as do groups that have never crossed the threshold in the required window.

Every business unit or permanent establishment consolidated by the ultimate parent entity (UPE) counts as a constituent entity, and the GIR aggregates data from all of them. Getting the perimeter right matters. Leaving out a profit-generating subsidiary is one of the most common compliance failures, and tax administrations cross-check the reported group structure against other filings such as the Country-by-Country Report.

Article 1.5 of the Model Rules carves several organizations out of scope: governmental entities and international organizations, non-profit organizations, pension funds that serve as the UPE, and certain investment funds and real estate investment vehicles acting as the UPE.¹ The OECD has published administrative guidance on where those categories end, particularly for hybrid structures.³

Who Files, and Where

Under Article 8.1.1, the filing obligation technically sits with each constituent entity, not with the UPE alone. In practice, the Model Rules offer a much simpler route: if the UPE, or a designated filing entity appointed by the group, files the GIR, every other constituent entity is discharged from that obligation, so long as a qualifying competent authority agreement is in effect between the filing entity’s jurisdiction and each constituent entity’s jurisdiction.⁴

When two or more constituent entities sit in the same country, the group can name one of them the Designated Local Entity and file a single GIR for all of them there. That avoids duplicate filings inside one tax administration.

Even where centralized filing relieves an entity from preparing the full return, each constituent entity still has to notify its local tax authority of the identity and location of the entity filing on its behalf. Article 8.1.3 imposes this notification obligation, and each implementing jurisdiction sets its own notification deadline. For the first reporting year, several countries have aligned notification with the extended 18-month filing window.

Designated Filing Entity

A group can appoint a designated filing entity when the UPE sits in a jurisdiction that has not implemented the GloBE rules or that lacks the necessary competent authority agreements. The designated filing entity takes over the UPE’s role and submits the GIR from its own jurisdiction. The group notifies each relevant tax authority of the appointment so that information exchange flows through the right channels.

When Local Filing Is Required

If no qualifying competent authority agreement exists between the filing entity’s jurisdiction and a particular constituent entity’s jurisdiction, that constituent entity has to file a GIR directly with its local tax authority. This happens most often when the UPE sits in a country that has not signed the Multilateral Competent Authority Agreement on the exchange of GloBE information (GIR-MCAA).⁵

What Goes In the Return

The OECD published the standardized GIR template in January 2025.⁶ It has three sections, and it collects the identification of every group member, the corporate structure, and the data needed to compute effective tax rates and top-up amounts.⁷

Section 1 — MNE Group Information. The UPE’s name and tax identification number, the fiscal year being reported, and the full list of constituent entities with jurisdictions and ownership details. This maps the corporate hierarchy that everything else builds on.
Section 2 — Jurisdictional Safe Harbours and Exclusions. For each jurisdiction, whether the group is claiming a safe harbour (transitional CbCR, QDMTT, or the newer side-by-side safe harbour) that shrinks or eliminates the full GloBE computation for that country.
Section 3 — GloBE Computations. Jurisdiction-by-jurisdiction effective tax rate calculations, adjusted covered taxes, GloBE income or loss, the substance-based income exclusion, and any resulting top-up tax amounts.

The template runs on an XML schema published by the OECD that supports electronic filing and automated exchange between governments.⁸ Most groups use specialized tax software to map accounting data into the schema’s fields. A missing or misformatted field can cause the receiving portal to reject the whole submission, so tax teams typically validate the XML file more than once before uploading.

Calculating GloBE Income or Loss

For each jurisdiction, GloBE income or loss starts with the financial accounting net income or loss of every constituent entity in that country and then adjusts for specific items that bridge book income and the GloBE tax base.⁹ The main adjustments are:

Excluded dividends and equity gains or losses, removing income from qualifying shareholdings to avoid double counting.
Policy-disallowed expenses, adding back deductions for items like illegal payments.
Stock-based compensation, keeping top-up tax from arising purely because of book-tax timing differences.
Asymmetric foreign currency gains and losses, correcting distortions when accounting and tax use different functional currencies.
International shipping income, excluded under Article 3.3 in line with longstanding international tax norms.

Section 3 of the template breaks out each of these adjustments so the tax authority can trace exactly how the group moved from its published financial statements to reported GloBE income.⁶ Keeping clear workpapers for each adjustment is where most preparation time goes, and it’s the part tax authorities are most likely to challenge.

Determining Adjusted Covered Taxes

The other side of the effective tax rate fraction is Adjusted Covered Taxes, the numerator that captures how much tax the group actually paid in each jurisdiction. It begins with the current tax expense in the financial statements and adjusts from there.⁹

Qualified refundable tax credits (those payable within four years) are added back to covered taxes rather than treated as reductions of income. Non-refundable credits and credits refundable only after four years reduce covered taxes in the year they are granted. A total deferred tax adjustment accounts for temporary differences and prior-year losses so that the effective tax rate reflects long-run tax rather than a single period’s cash.

Certain taxes have to be reallocated. CFC taxes imposed on a parent, withholding taxes on distributions, and taxes attributable to permanent establishments all flow to the jurisdiction where the income arose rather than staying with the entity that technically paid them. After filing, if a material change in a prior year’s tax liability comes to light, Article 4.6 requires the group to recompute the effective tax rate for that year. Any additional top-up tax from the recalculation is due in the current year; no amended prior-year return is needed.⁹

Top-up Tax and the Substance-Based Income Exclusion

Once you have a jurisdictional effective tax rate — Adjusted Covered Taxes divided by GloBE Income — compare it to the 15% minimum. If it falls short, the shortfall is the top-up tax percentage, applied to the group’s excess profits in that jurisdiction.¹⁰

Excess profits are not the full GloBE income. They are GloBE income minus the Substance-Based Income Exclusion (SBIE), which reduces the income base subject to top-up tax based on two indicators of real economic activity in the country: payroll costs and the carrying value of tangible assets.¹¹ At full phase-in, the exclusion equals 5% of eligible payroll plus 5% of the carrying value of tangible assets in the jurisdiction.¹²

A 10-year transition period provides higher carve-out rates during the initial years. It starts at 10% for payroll and 8% for tangible assets, and both figures decline annually toward the permanent 5% rate.¹² For fiscal years in 2026, the transition rates are still meaningfully above the long-term 5%, which can substantially reduce or eliminate top-up tax in countries where the group has significant employees and physical operations.

Safe Harbours That Cut the Work

Safe harbours exist so groups can skip the full GloBE calculation in jurisdictions where the risk of undertaxation is low. Qualifying in a given country means reporting minimal data in Section 2 of the GIR rather than working through the full computation in Section 3.

Transitional CbCR Safe Harbour

The most widely used safe harbour during the initial years relies on data already in the Country-by-Country Report. A jurisdiction qualifies if it meets any one of three tests:¹³

De minimis test: total revenue below €10 million and profit before income tax below €1 million in that jurisdiction on the qualified CbC Report.
Simplified ETR test: the simplified effective tax rate (income tax expense divided by profit before tax from the CbC Report) equals or exceeds the transition rate — 17% for fiscal years beginning in 2026.
Routine profits test: the jurisdiction’s profit before income tax is equal to or less than the SBIE amount calculated for entities in that jurisdiction.

The transitional CbCR safe harbour covers fiscal years beginning on or before December 31, 2026, and not ending after June 30, 2028. A “once out, always out” rule applies: if a group chooses not to claim it for a jurisdiction in a year when it was eligible, it cannot claim it for that jurisdiction in any later year.¹³

QDMTT Safe Harbour

When a jurisdiction has enacted its own qualifying domestic minimum top-up tax (QDMTT) that meets the OECD’s accreditation criteria, the top-up tax collected locally satisfies the group’s obligation. The group can treat that jurisdiction as safe-harboured, cutting out a separate top-up calculation under the Income Inclusion Rule (IIR) or the Undertaxed Profits Rule (UTPR). This safe harbour is permanent, not transitional.

Side-by-Side Safe Harbour

Released in January 2026, the Side-by-Side (SbS) Safe Harbour package introduces elective safe harbours that let qualifying groups avoid additional IIR or UTPR top-ups while preserving a jurisdiction’s right to impose a QDMTT. The SbS package applies to fiscal years beginning on or after January 1, 2026, and is designed to ease the compliance burden as the transitional CbCR safe harbour winds down.

Deadlines and How to Submit

The standard filing deadline is 15 months after the last day of the reporting fiscal year.¹⁴ For the first fiscal year a group falls under the GloBE rules, that stretches to 18 months.² For most calendar-year groups with a fiscal year ending December 31, 2024, that lands on June 30, 2026.

Submission runs through the secure online tax portal of whichever jurisdiction receives the filing. Portals typically require upload of the validated XML file and use multi-factor authentication for corporate tax representatives. After a successful upload, the portal generates a filing receipt that serves as the group’s legal record of compliance. Retain that receipt with the supporting workpapers.

How the Filing Reaches Other Countries

Centralized filing works because of an international information-sharing mechanism. The GIR-MCAA lets the jurisdiction that receives the centralized return share it automatically with every other jurisdiction where the group has constituent entities.⁵ That removes the need to file a full GIR in every country of operation.

Exchange only works when both the filing jurisdiction and the receiving jurisdiction are signatories to the GIR-MCAA (or have an equivalent bilateral agreement). Dozens have signed, but gaps remain. Where the filing jurisdiction lacks an agreement with a particular country, constituent entities in that country file locally. Check the current signatory list before finalizing the filing strategy for each reporting year.

What U.S.-Parented Groups Have to Do Differently

The United States has not enacted Pillar Two legislation and does not currently require GIR filing at the federal level. Congress has not passed a legislative response to the GloBE rules, though a safe harbour provision shields U.S.-based groups from the UTPR through the end of 2026 because the U.S. corporate tax rate exceeds 20%. That protection is set to expire.

The practical consequence is significant. Because the U.S. has not signed the GIR-MCAA and has not implemented the GloBE rules domestically, a U.S. parent cannot file a centralized GIR that other jurisdictions will accept. Groups in this position typically appoint a designated filing entity in an implementing jurisdiction, often the jurisdiction of a major European subsidiary, that files the centralized GIR on the group’s behalf. Constituent entities in jurisdictions without a qualifying agreement with the designated filing entity’s jurisdiction still have to file locally.

Penalties for Late or Incorrect Filing

Each implementing jurisdiction sets its own penalties for late, incomplete, or incorrect GIR filings. The Model Rules leave penalty design to national law, so amounts and structures vary widely. Some jurisdictions apply fixed late-filing penalties; others impose percentage-based fines on unpaid top-up tax. The UK has indicated that late filing can attract penalties, but adopted a transitional approach that initially reduces the penalty to zero when a valid notification is filed on time and the GIR is submitted in the designated jurisdiction by the UK deadline.¹⁵

Beyond formal penalties, an incorrect GIR can trigger broader audit activity. Tax authorities use the return to cross-reference other corporate filings and international data sets, and discrepancies between the GIR and a group’s CbC Report or local tax return tend to draw scrutiny. Well-organized workpapers — showing how each financial accounting figure was adjusted to reach the GloBE definitions — are the most effective protection against both penalties and drawn-out audit disputes.

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