Solution

Pillar Two – Tax

Our custom-built application, tailored for the nuanced demands of Pillar Two tax reporting including both Safe Harbour and GloBE calculations, leverages the robust functionality of IBM Planning Analytics. This setup not only caters to specialized financial data entry and analysis needs but also integrates seamlessly with IBM Controller. This ensures a streamlined connection to your reporting structures, across both legal and country-by-country facets, ensuring data integrity and governance.

Intito’s Pillar Two – Tax Solution

What really makes our application shine is its focus on auditability and transparency. It is designed to simplify and automate the complex layers of tax reporting. It’s all about giving the group tax function a clear, traceable line from data entry to final reports, and providing a tool to make strategic decisions on solid ground.

With IBM Planning Analytics at its core, this solution provides a structured approach to managing the complexities of tax reporting, ensuring your team is well-equipped to meet the new Pillar Two reporting requirements.

Pillar Two in a nutshell

Pillar Two reporting is part of a global tax initiative designed to ensure that multinational enterprises (MNEs) pay a minimum level of tax on the income generated in each of the countries in which they operate. This initiative is a response to the Base Erosion and Profit Shifting (BEPS) project led by the OECD/G20, aimed at combating tax avoidance strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations. Pillar Two introduces rules for the global minimum taxation of MNEs, including the Income Inclusion Rule (IIR) and the Undertaxed Payments Rule (UTPR), which are central to ensuring the global minimum tax rate is applied effectively.

Pillar Two reporting requirements present several challenges for organizations

Complexity: The rules are complex and require a deep understanding of the tax legislation in multiple jurisdictions. This complexity is compounded by the need to calculate the effective tax rate (ETR) for each jurisdiction, considering various adjustments and exclusions.
Data collection and analysis: Companies must collect and analyze a vast amount of financial data from all their operations worldwide. They must ensure that the data is accurate, complete, and meets the specific reporting requirements of Pillar Two.
Cost of compliance: The administrative burden of complying with these new regulations can be significant, requiring substantial investment in internal processes, systems, and training.
Strategic impact: Beyond compliance, the regulations can influence business decisions about investments, corporate structure, and global operations, requiring strategic thinking and planning.
Cross-jurisdictional coordination: Effective compliance requires coordinated efforts across multiple jurisdictions, requiring robust communication and data-sharing mechanisms within multinational organizations.

These challenges highlight the need for sophisticated reporting solutions that can handle the complexities of Pillar two, streamline data collection and analysis, ensure compliance, and support strategic decision-making.

Are you keen to see what Intito Pillar Two – Tax looks like in practice? Book a demo!

Ready to transform your business? Contact us!

Enhance your company’s capabilities with Intito’s expert solutions and services. Our dedicated team is here to assist you in moving your business forward. Fill out the form to book a consultation today!