Is Time Running Out for Your Pillar Two Vendor Selection? 

With the first GloBE reports due in early 2025, many companies are feeling the pressure to prepare for Pillar Two. For over a year, discussions have been ongoing between businesses, advisors, and technology providers to ensure a deep understanding of Pillar Two and to find the right software solution for the necessary calculations and reporting. Despite these efforts, many are still in the vendor selection phase, and time is running out. 

This newsletter will explore the upcoming filing deadlines, the challenges presented by Pillar Two, essential considerations for your first GLoBE Information Return (GIR), and how the ARKK Automation Platform can be your strategic advantage in Pillar Two compliance. 

When is the First GIR Filing Deadline? 

The UK has officially announced that the first Income Inclusion Rule (IIR) and Qualified Domestic Minimum Top-up Tax (QDMTT) will be required for fiscal periods ending after 31 December 2024. This means that entities with a December year-end affected by Pillar Two must be ready to submit these reports to HMRC by 30 June 2026. Remember, the UK is just one of numerous jurisdictions you might need to consider for your GIR. This report is essential as it contains the information a tax administration needs to perform an appropriate risk assessment and to evaluate the correctness of a Constituent Entity (CE)’s Top-up Tax liability.

Understanding the Pillar Two Challenge 

Pillar Two is more than a financial planning exercise; it presents a significant data challenge. Have you fully digested the OECD guidelines yet? If not, it’s time to knuckle down and prepare for a substantial amount of information. Once you've absorbed the details, you'll understand that managing this complexity requires robust tools that not only handle vast amounts of data, but also support your strategic decision-making with auditable and transparent information. 

The Requirements for Filing Your First GIR 

To file your first GIR, you’ll need to manage data- and lots of it. You'll need to calculate the top-up tax, ensure compliance, and produce reports in an XML format. The Global Anti-Base Erosion (GloBE) reporting under Pillar Two significantly ups the ante, increasing the requirement from around 140 data points in Safe Harbour assessments to many more in the full GloBE reports. Moreover, many of these data points may not currently exist within your tax and finance systems. 

How do you systematise the data collection, calculate the missing points, and ensure you can manually input and amend data where auto-population isn’t feasible? The answer lies in adopting a sophisticated software tool designed for these demands.

The ARKK Automation Platform: Your Playbook for Pillar Two Compliance 

The ARKK Automation Platform offers a clear path to navigating the complexities of Pillar Two with ease and precision.  

The Platform is your essential tool for compliance, featuring: 

• Source-agnostic data aggregator: Streamlines compliance by efficiently compiling essential data from diverse sources, crucial for Safe Harbours and beyond. 
• Transparent and auditable system: Provides a straightforward audit trail, enhancing transparency and easing the compliance process. 
• Scalable solution: Adapts to your needs from initial assessments to full compliance filings, ensuring you are prepared now and in the future. 
• Integrated visualisation with Power BI: Converts complex data into actionable insights, simplifying decision-making directly from your source data. 
• Built-in XML engine for Pillar Two reporting: Produces reports in the correct format for each jurisdiction. 

By choosing the ARKK Automation Platform, you’re not just preparing for the upcoming Safe Harbour’s deadline but setting your business up for ongoing compliance and success. Get in touch today to explore how ARKK can streamline your Pillar Two obligations and keep your business ahead in the compliance journey.