Pillar 2: What needs to be filed?
For UK groups and UK members of multinational groups who are within scope of the Multinational Top‑up Tax (MTT) or Domestic Top‑up Tax (DTT), Pillar 2 compliance is not a single filing exercise, but a broader ongoing reporting obligation.
Broadly, Pillar Two compliance in the UK consists of:
- the GloBE Information Return (GIR) or an Overseas Return Notification (ONR).; and
- the UK Self Assessment Return (SAR).
While both are mandatory, they serve distinct but complementary purposes.
The UK Self Assessment Return (SAR)
Filed electronically through HMRC’s Pillar 2 service, the SAR is used to report any UK top‑up tax due under MTT or DTT, to record certain elections, and to provide identifying and group‑fit information. As a formal UK tax return, the SAR must be supported by robust underlying evidence, even where the UK liability is nil.
The GloBE Information Return (GIR)
Designed to support the exchange of information between global tax authorities, the GIR contains the group‑wide Pillar 2 calculation, and sets out top‑up tax outcomes, jurisdictional effective tax rates, and the application of safe harbours.
This return must be prepared in line with an XML schema from the Organisation for Economic Co-operation and Development (OECD), which prescribes how data must be structured, categorised and submitted.
Who files the GIR?
It is the responsibility of the relevant UK filing member to submit the GIR to HMRC, unless the GIR has already been filed by a qualifying authority as recognised by the OECD. In such cases, a UK entity may instead be required to submit an Overseas Return Notification (ONR).
However, there can be an additional layer of complexity if the jurisdiction of the ultimate parent is yet to implement a local GIR filing facility – as is the case for locations such as the United States, China and India.
Importantly, this does not remove the obligation for UK entities to file where required.
Interaction between the SAR and GIR
It’s important to note that, regardless of whether the SAR shows UK top-up tax payable, HMRC may question how the SAR position has been determined and expect this to be supported by a corresponding GIR or ONR.
In practice, this means the two filings should be aligned and supported by consistent underlying data and analysis.
We’re here to help
If you would like to discuss how these obligations apply to your group or UK entity within a multinational group, please get in touch with a member of our specialist Corporate Tax team or speak to your usual Azets adviser.
