Programme Management for BEPS Pillar Two
The OECD’s Base Erosion and Profit Shifting (BEPS) Pillar Two initiative is now live, introducing a complex global minimum tax framework. This new regime presents significant reporting and compliance challenges for multinational enterprises (MNEs) with annual revenue of €750 million or more. While Pillar Two is already live, its scope and requirements will continue to evolve over the next few years, making now a crucial time for businesses to implement a Pillar Two Programme.
Why a Pillar Two Programme is Essential
Precisely what’s needed for MNEs to be Pillar Two ready will continue to evolve as Transitional Safe Harbours phase out and countries implement Pillar Two into their own laws, each with different timelines and details.
Therefore, to efficiently integrate Pillar Two into Tax Reporting & Compliance, MNEs will need a programme that is comprehensive enough to handle the breadth and complexities of the regime but also agile enough to adapt as requirements evolve. At Complete Projects, we specialise in building such programmes, ensuring a streamlined, cost-effective and risk-mitigation based approach.
These are the Top 10 Complexities & Variables that large MNEs will face as they work to implement Pillar Two into their reporting and compliance structures:
1. Complex & Evolving Global Model Rules
2. Transitional Safe Harbours
3. Country Enactment Variables
4. QDMTTs
5. Changes to Related Tax Laws
6. Joint Ventures
7. Undertaxed Profits Rule (UTPR)
8. Changing Legal Entity Footprint
9. Evolving Technology
10. Many Stakeholders for Diverse Data Inputs
For more detail on each of the headlines, see our article here:
BEPS Pillar Two: Top 10 Complexities & Variables — Complete Projects
Example Pillar Two Programme Workstreams
We tailor all Programmes to specific client requirements. But this visual illustrates the workstreams most Pillar Two Programmes need:
For Scope, we stay up to date on the latest rules guidance and country enactments. And we get across the detail of your legal entity footprint to understand where and when you'll need Transitional Safe Harbour, GIR & QDMTT compliance.
We then engage the required stakeholders via workstreams that Enable cost-effective build-out of reporting and compliance solutions whilst making use of transitional safe harbours through to FY27.
This sets the programme up for the Delivery of financial reporting that meets auditor requirements; and on-time registrations + filings for Transitional Safe Harbour, GIR, QDMTT and UTPR compliance.
Pillar Two Software Selection & Implementation
As Pillar Two reporting and compliance becomes a reality for MNEs, the need for effective software solutions is becoming increasingly clear. In fact, a live survey of more than 100 companies at the International Tax Review’s inaugural Pillar Two Forum in September 2024 revealed that 65% of companies anticipate needing to source and implement specialised Pillar Two software.
At Complete Projects, we have significant experience guiding clients through every step of this process - from selecting the right software, via RFI/Ps and Proof of Concept through to ensuring a smooth and successful implementation.
We’re on top of the evolving options (illustrated below) so can quickly get you to a shortlist aligned to your specific needs.
Source: ITR Pillar Two Forum, 19th September 2024
Some of the Pillar Two solutions in the market:
But selecting the best option is just the start!
With our extensive software implementation expertise we can manage the considerable challenges of:
Configuration & integration with your existing systems
Data sourcing & cleansing
User set-up & training
Technical & user acceptance testing
Go-live and embedding through to ‘business as usual’
Pillar Two will particularly require ongoing processes, controls and automations to source and standardise the large volumes of data that will be incrementally needed from disparate sources over the next few years. At Complete Projects, we ensure that your solution is not only implemented effectively but also scalable and sustainable for the future.
Artiom, Mick, Coren & Stephen at the inaugral ITR Pillar Two Forum in September 2024
Our Programme Management
At Complete Projects we’ve been delivering international tax, finance, legal and CoSec programmes since 2008. We've delivered for organisations of all sizes and sectors, spanning energy, technology, government, manufacturing, telecoms and pharma. Our extensive expertise allows us to create flexible, cost-effective solutions tailored to clients' needs.
If you're ready to navigate the breadth, complexities and variables of Pillar Two with confidence, get in touch with Complete Projects today to to discuss how we can mobilise and deliver your Pillar Two Programme.
ABOUT THE AUTHOR
Mick is the PPPM Lead at Complete Projects which he founded in 2008; he is a proven leader with over 35 years of experience in Operations and PPPM, spanning social care, legal services, government, energy, manufactured goods and digital education. Mick also brings broader HR, IT, L&D people and team leadership from having senior management responsibility in diverse environments.