Hong Kong Pillar Two Notification: What We Learned from the First Filing Season

Hong Kong implemented its Pillar Two regime for financial years beginning on or after 1 January 2025. For an overview of the rules and compliance requirements, please refer to our earlier article, Pillar Two – Global Minimum Tax.

With Hong Kong having completed its first Pillar Two notification filing season, several practical lessons have emerged. For in-scope multinational enterprise (MNE) groups with a 31 December 2025 year-end, the first notification deadline fell on 30 June 2026.

One key lesson stood out: Start early.

1. Administrative Preparation Took Longer Than Expected

Many groups required more time than anticipated to complete Business Tax Portal registration, establish authorised users, obtain access codes and activate their accounts.

As notifications are filed electronically through the newly launched Pillar Two Portal, administrative readiness became a critical factor in meeting the filing deadline, particularly as certain steps depended on processing by the Inland Revenue Department.

Lesson learned: Do not underestimate the time required to complete portal registration and user setup.

2. Group-Wide Information Was Needed

Although the notification is filed locally, much of the required information resides with regional or headquarters teams.

Hong Kong finance teams often needed to obtain information and approvals from overseas headquarters, such as the Group's GloBE filing strategy and whether the Group was subject to a qualified IIR or UTPR outside Hong Kong.

Challenges became more pronounced where no prior Pillar Two assessment had been performed, particularly if the headquarters jurisdiction had not adopted Pillar Two rules. In some cases, local finance teams also had limited visibility of the Group’s overall structure.

Lesson learned: Early communication with headquarters and overseas tax teams can significantly reduce last-minute filing pressure.

3. The Notification Is Only the Beginning

Completing the notification was an important milestone, but it is only the first step in Hong Kong's Pillar Two compliance journey.

The next major compliance milestone is the Top-up Tax Return, which will require substantially more detailed information, extensive data gathering and complex calculations.

Although an extended 18-month filing deadline applies for the first transition year, groups should not assume there is ample time.

Key takeaway: Pillar Two compliance requires coordination across tax, finance and headquarters teams. Preparing the Top-up Tax Return will require significant data extraction, technical analysis and cross-border collaboration.

Recommended Action

Start preparing now for the Top-up Tax Return.

Unlike the notification, the return will require significantly more detailed data collection, technical analysis and, where applicable, the calculation of top-up tax liabilities.

Early planning, clear ownership and timely coordination across the Group can help reduce compliance risks and avoid last-minute challenges.