Pillar Two seeks to ensure that large multinational enterprises (MNEs) pay a minimum level of tax in every jurisdiction where they operate, by imposing a minimum effective tax rate (ETR) of 15% on a jurisdiction‑by‑jurisdiction basis. It applies to MNEs with consolidated global revenues of at least EUR 750 million.

For in‑scope Indian MNEs, Pillar Two rules generally become applicable from FY 2024‑25. Among the several compliance obligations under Pillar Two, the most critical is the filing of the GloBE Information Return (GIR). For FY 2024‑25, the due date for filing the GIR is 30 September 2026.

What is GIR?

The GIR is a standardised reporting template that provides tax administrations with all the information required to evaluate the accuracy of an MNE group’s top‑up tax liability under the GloBE Rules.

The GIR is divided into three parts:

• Section 1 – MNE Group Information
  This section captures foundational information such as details of constituent entities, their ownership and shareholding structure, and high‑level jurisdiction‑wise ETRs and top‑up tax.
• Section 2 – Jurisdictional Safe Harbours and Exclusions
  This section sets out, on a jurisdiction‑by‑jurisdiction basis, whether the group has availed any applicable safe harbours (e.g., transitional CbCR safe harbour) and the outcome of those tests.
• Section 3 – GloBE Computations
  For jurisdictions that do not qualify for safe harbours, this section provides the detailed GloBE income, covered taxes, and top‑up tax computation.

Who Files the GIR and Where?

Under the GloBE Rules, each Constituent Entity is, in principle, required to file a GIR with its local tax administration. However, this obligation is generally discharged where the Ultimate Parent Entity (UPE) or another Designated Filing Entity in the group files the GIR in its jurisdiction of residence and that jurisdiction’s Competent Authority has entered into, and activated, a Qualifying Competent Authority Agreement for the automatic exchange of GIRs with the jurisdictions of the other Constituent Entities.

This means Indian MNEs must decide in which jurisdiction the GIR will be filed and carefully review the Multilateral Competent Authority Agreement and the status of activated exchange relationships.

If a jurisdiction has not activated the exchange relationship for the GIR by the relevant date, Constituent Entities located there may be required to submit the GIR even if a group‑level filing has been made elsewhere. However, on 18 May 2026 the OECD issued a “common understanding” among certain jurisdictions intended to mitigate the effects of possible delays in the availability of fully operational GIR filing portals or exchange relationships for Pillar Two. The revised version of the common understanding was released on 6 July 2026. Multinational groups should evaluate how this common understanding affects their specific GIR compliance obligations. This assessment cannot be deferred until the last minute.

Why the GIR Is Not “Just Another” Compliance Form

It is tempting to view the GIR as a mechanical reporting requirement. In reality, the GIR is much more than an information form. Through the GIR, certain key elections and classifications are made, many of which can affect the jurisdictional ETRs, top‑up tax exposure, and the allocation of taxing rights between jurisdictions, not only for FY 2024‑25 but for subsequent years as well.

Some of the critical aspects are outlined below.

1. Entity Status: The GIR requires each Constituent Entity to be tagged with its appropriate status under the GloBE Rules, such as Partially Owned Parent Entity, Joint Venture (JV), JV subsidiary, or Minority‑owned Constituent Entity, etc. These classifications can affect the jurisdictional ETR calculation and top‑up tax allocation, and determine which jurisdiction has the primary taxing right over the top‑up tax (e.g., under the Income Inclusion Rule).

2. GloBE Loss Election – Implications Beyond the First Year: For jurisdictions in a GloBE loss position, the MNE needs to decide whether to make a GloBE Loss Election in the GIR. Under this elective regime, GloBE losses are effectively carried forward via a deemed deferred tax asset mechanism. The GloBE Loss Election is particularly relevant where jurisdictions have no or very low corporate income tax, making traditional deferred tax accounting less meaningful, or certain entities are in chronic or long‑term loss positions. Crucially, this is a five‑year election. Once made, it will generally bind the group for that jurisdiction for five fiscal years. The costs and benefits must be modelled for multiple years, not just FY 2024‑25.

3. Other Elections

Several other elections operate at the jurisdiction level, some annual and others fixed for five years, and can materially affect ETRs and top‑up tax.

One important example is the election to apply the realisation method for assets and liabilities that are measured at fair value or under impairment accounting in financial statements. Under this election, GloBE income is aligned more closely with realised gains and losses. This election can be made for all assets and liabilities in a jurisdiction or restricted to tangible assets only. This is a five‑year election at the jurisdiction level.

The above examples highlight that “technical” choices in the GIR can have economic consequences over several years.

The Final Stretch Before the GIR Deadline

Most large Indian MNEs have already embarked on the GIR preparation process. For those that have not, the deadline is approaching in a “few weeks.”

For MNEs with a calendar year reporting period, the first GIR deadline fell on 30 June 2026, and experience from these early filers offers important lessons. Some jurisdictions experienced last‑minute portal glitches, causing delays and requiring interventions or temporary workarounds. In certain countries, the electronic filing portal was not fully operational prior to the statutory due date, creating uncertainty around the mode and timing of filing.

These early experiences underscore the importance of initiating the GIR process immediately.

Conclusion

The GIR is not a routine, after‑the‑fact disclosure. It is an integral part of the overall Pillar Two process that could impact the group’s ETR profile across jurisdictions for years to come.

For Indian MNEs, treating the GIR as a strategic project, rather than a mere compliance form, will be critical to managing global minimum tax exposure and ensuring a smooth first‑year implementation of Pillar Two.