Cross-border Adjustments

Last updated on 2025-07-21

Overview

While allocations and adjustments are legally distinct concepts, from a technical perspective, cross-border adjustments work similar to tax allocations and FTE & PE allocations.

Cross-border adjustments can be imported as part of the allocations import, but the adjustments can also be manually created. The Cross-border Adjustments workspace is used to create cross-border adjustments between a source and a target CE. The transferred values affect the CE calculation in the fields INC-2.13 and CT-2.17.

This article contains the following sections:

Navigation

The Cross-border Adjustments workspace can be found at Pillar 2 | Entity Data Collection | Cross-border Adjustments. The workspace is displayed as follows, for example:

'Cross-border Adjustments' workspace
'Cross-border Adjustments' workspace

Notes:

  • Adjustments use the local currency of the source CE.
  • The Incoming allocations tab is purely informational. Entering new adjustments or editing existing adjustments must be done outgoing from the source CE.
Creating Adjustments

In addition to the option to import adjustments, you can also manually create new adjustments in the Pillar 2 module. To create a new cross-border adjustment:

  1. In the Cross-border Adjustments workspace, select a period from the Applies to period drop-down menu.
  2. Select the source CE from the Company drop-down menu.
  3. Click Create.
  4. Select the following: 
    • A target CE.
    • An adjustment type:
      • Arm’s length adjustments
      • Intragroup financing arrangements
  5. Enter an amount for the Addition to the corresponding Adjustments of the GloBE Income or Loss.
  6. Click Save.

Note: Optionally, you can upload supporting documents as an attachment to the adjustment or add a description, e.g. a comment that explains divergences from prior years.

Editing Adjustments

In addition to the option to import adjustments, you can also manually create new adjustments in the Pillar 2 module. To create a new cross-border adjustment:

  1. In the Cross-border Adjustments workspace, select a period from the Applies to period drop-down menu.
  2. Select the source CE from the Company drop-down menu.
  3. Click Edit.
  4. Select an adjustment type:
    • Arm’s length adjustments
    • Intragroup financing arrangements
  5. Enter the amount of CFC tax expense to be allocated to the selected subsidiary in the local currency of the source CE.
  6. Click Save.

Note: Optionally, you can upload supporting documents as an attachment to the adjustment or add a description, e.g. a comment that explains divergences from prior years.

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