Pillar Two – technical amendments, and Pillar Two compliance

The Department of Finance recently published Finance Bill 2025 (the Bill) which sets out the legislative changes required to implement the Budget Day announcements. The Bill included a number of technical amendments to the Irish Pillar Two legislation. The most notable being the transposition of EU DAC 9 into Irish domestic law. This seeks to establish a unified compliance framework that streamlines Pillar Two administration and enables more effective cross-border risk assessment by tax authorities.

Please find below a detailed description of the technical updates introduced by the Finance Bill 2025:

DAC 9 

DAC9 is the EU’s 2025 Directive which amends the rules on administrative cooperation in taxation to support the implementation of Pillar Two. It introduces a standardised Top-up Tax Information Return  (TIR), commonly referred to as GloBE Information Return (GIR). This enables centralised filing for large multinational and domestic groups, and mandates automatic exchange of this information among EU member states. 

• The Bill transposes DAC9 into Irish law, with all EU Member states obliged to implement the Directive by 31 December 2025. DAC9 allows for filing of the TIR in one EU Member State as opposed to multiple filings across different EU countries. The Bill clarifies that where the TIR is filed outside the EU,  it will follow the OECD GIR template.
• The Bill also confirms that where the filer is in an EU member state, information will be exchanged automatically among tax authorities within the EU. The Bill clarifies that where the TIR is filed outside the EU, the OECD Multilateral Competent Authority Agreement (MCAA) dissemination approach will be followed.

OECD Administrative Guidance (January 2025) 

The Bill gives effect to the OECD Administrative Guidance issued in January 2025, aligning Ireland’s Pillar Two legislation with ongoing OECD developments. These amendments relate specifically to the following:

• Treatment of certain deferred tax assets that arose prior to the application of the global minimum tax rules, because of  specific governmental arrangements or following the introduction of a new corporate income tax in other jurisdictions.
• Under a merger or division, clarification has been provided that any Pillar Two top-up payments and filings will be transferred to the successor company.
• Where the ultimate parent entity does not prepare consolidated financial statements under an acceptable or authorised standard, or the purposes of determining the financial accounting net income or loss, the applicable financial statements are those that would have been prepared under an acceptable or authorised standard.
• Orphan owned entities that are fully consolidated within the MNE Group fall into the category of a “minority owned constituent entity”. The Bill confirms that any associated top-up taxes of any such entities should be re-allocated to other Irish group entities that are not securitisation entities.

Pillar Two compliance obligations

With Irish Pillar Two registration, and compliance deadlines fast approaching, advancing Pillar Two workstreams will be essential to ensure full compliance with the Irish rules. 

Pillar Two registration

The Irish Pillar Two registration deadline is nearly here, with Irish constituent entities of in-scope groups required to register within 12 months of the end of the first financial period within scope of the rules. The first registration deadline is 31 December 2025, for any entities with a 2024 fiscal year end. A penalty of €10k will apply for the failure to register in advance of the deadline. Please see our insight here.

Pillar Two compliance

The first Pillar Two filings are due on or before 30 June 2026, with in-scope groups required to file a relevant Pillar Two top-up tax return and pay any top-up taxes due to the Irish Revenue.

Pillar Two audit readiness

In accordance with IAS 12, FRS 101, and FRS 102, entities are required to include separate Pillar Two disclosures within their financial statements. Groups will need to determine the final Pillar Two liabilities for the first in-scope period and concurrently estimate the Pillar Two top-up tax applicable to the following financial period. Please see our insight here.

Country-by-country Report (CbC Report) 

The availability of safe harbours is predicated on the CbC Report being considered “qualifying” from a Pillar Two perspective. With the CbC Report filing deadline approaching it is important that Group review and validate the information included in the CbC Report from a Pillar Two perspective. 

Please see here for further RSM Ireland Pillar Two insights. Should you require any support with the Irish Pillar Two registration, upcoming Pillar Two compliance, or any other Pillar Two support, please reach out to any of our specialist Pillar Two team below or your usual RSM contact.