--- title: "What's New in Pillar 2" description: "Discover the latest features and improvements of the **Pillar 2** sub-module." source_url: https://support.lucanet.com/en/whats-new/whats-new-tax-compliance-reporting/income-taxes/pillar-2 language: en last_updated: 2026-05-28 --- # What's New in Pillar 2 Come and explore the latest features and improvements of our **Pillar 2** sub-module! > **Note:** The versions of all solutions that you are currently using and those of the CFO Solution Platform are displayed when you select **About Lucanet** from the **Help** section in the CFO Solution Platform. ## Recently Released Features ### New in Version 260513 (Release date: 2026-06-03) Apart from bug fixes and performance enhancements, the release contains the following new features: #### GIR XML File and Report Preview Available The **GloBE Information Return (GIR)** XML export is now available for your first filing. A new readable **preview** lets you review the submitted content, navigate between jurisdictions, and use the export or print options. #### Top Receiving Jurisdictions per Report Part The GIR XML report requires separate **receiving-jurisdiction codes** for the **General Section**, **Summary**, and **Jurisdiction Section**. In **Group Data Collection**, you can now define who receives the **General Section**. In **Jurisdictional Data Collection**, you can define which jurisdictions receive the **Summary** for each subgroup and the **Jurisdiction Section** for each jurisdiction. The preselected **Receiving Country (GEN-3.2)** remains mandatory and always receives the complete report. The **Receiving Country** field is now also shown in the **Start Transmission** dialog when GIR is selected. #### Jurisdictions with Taxing Rights and Reportable Differences In **Jurisdictional Data Collection**, the new **Jurisdiction(s) with Taxing Rights** section lets you list all jurisdictions that hold taxing rights for the selected country and, where applicable, capture **Reportable Differences** for cases in which jurisdictions calculate top-up tax differently. A new **Add Jurisdiction with Taxing Rights** button opens a detail view where you can enter the relevant data. #### Handling Separate QDMTT Snapshots In **Jurisdictional Data Collection**, field **DMT-0.2** lets you choose whether the QDMTT calculation is included in the **Global Snapshot** or taken from a **Separate QDMTT Snapshot**. When **Separate QDMTT Snapshot** is selected and finalized, the GIR XML file and its preview use the relevant QDMTT values from the marked snapshot. To review the QDMTT calculation data itself, open the corresponding **QDMTT Snapshot**. In the **Global Snapshot** detail view, the jurisdiction overview shows which QDMTT snapshots are included and which version they are based on. If a newer version exists or relevant differences were added afterward, a warning is shown so that you can create a new **Global Snapshot** before submission. #### German QDMTT: Data Collection and XML Filing For German QDMTT, **Entity Data Collection** now includes a dedicated **QDMTT Germany** workspace under a new **QDMTT** menu for **Constituent Entity Information**. The master data required for German QDMTT is maintained in **Jurisdictional Data Collection**, which displays Germany-specific QDMTT fields whenever Germany is the selected jurisdiction. This also changes the **German QDMTT Snapshot**, which no longer includes all **Group Data** information and instead contains the specific German QDMTT fields from the jurisdictional data collection for Germany. The **German QDMTT XML** for Elster transmission is now available. #### Submission of Pillar 2 Reports via Tax Transfer Hub You can now submit **GIR** and **QDMTT** reports via the **Tax Transfer Hub (TTH)** from Pillar 2. > **Note:** If you are preparing a German GIR, make sure that the final snapshot does not contain a warning in **Group Data** and that all German tax identification numbers are entered as 13 characters without `/` or `-`, so that BZSt validations are not triggered. #### New Income Inclusion Tab and Updated Top-up Tax Allocation A new **Income Inclusion** tab is now available in **Detail Results**. Fields **TA-4.1** to **TA-5** and **TA-7** have moved from **C5 – Top-up Tax Allocation** to the new tab, which also contains the **IIR Offset** and **Additional Current Top-up Tax**. In **Overview Results**, the **Top-Up Tax Liability** chart includes a **TA-6** segment for any **Additional Current Top-up Tax**. ### New in Version 260323 (Release date: 2026-03-24) Apart from bug fixes and performance enhancements, the release contains the following new features: #### Reporting of Deemed Distribution Tax Available In Pillar 2, you can now report **Deemed Distribution Tax (DDT)** under Article 7.3. You can record whether the **Deemed Distribution Tax** election under Article 7.3.1 has been made and, for each fiscal year, capture the recapture mechanism: the fiscal year, total DDT paid or used, opening and closing balances of recapture accounts, and DDT paid or used in the reporting year and the three preceding years. When a constituent entity (CE) leaves the group, you can report the reduction to **Adjusted Covered Taxes** for prior years and the incremental top-up tax per Article 5.4.1. Recording the DDT works as follows: In **Entity Data Collection | OECD-Standard**, the new **Deemed Distribution Tax** workspace lets you enter the tax that would have been due if income subject to the **Eligible Distribution Tax Regime** had been distributed (Article 7.3.2(b)), and the taxes already paid on actual or deemed distributions (Article 7.3.3(a)). These values feed into the calculation. In **C4 – Jurisdictional Blending**, a **Deemed Distribution Tax** section below **Information** displays the calculated DDT for the reporting year. #### Standardized OECD XML Report Available Pillar 2 now features **GIR (GloBE Information Return)**, the standardized XML report under the OECD Pillar 2 rules. It contains the data that in-scope groups must submit to tax authorities, e.g. GloBE income, covered taxes, or constituent entity information. You can generate this report from your Pillar 2 data; Pillar 2 adds data to the required structure so your submission aligns with the OECD schema. The most important features are: - **Message Header and Filing Information**\ \ The XML report obtains data at group level from your **Group Data Collection** and snapshot. The sending entity's tax identification number (TIN) is copied from the master data; you can enter a domestically defined identification number if it differs. A unique identifier by the sending jurisdiction is generated automatically. - **Multiple Receiving Countries**\ \ You can select **multiple receiving countries** in the **Group Data Collection** workspace in one go. The snapshot and XML export reflect all selected countries, so you can prepare one report for several jurisdictions without repeating the process. - **Transition Year**\ \ You can set a **group-wide transition year** in the report information; for each jurisdiction you can optionally choose a different year than the group default. **Jurisdictional Blending** displays the effective transition year per jurisdiction and subgroup so you can see at a glance which year applies where. - **DocRefIds for Germany**\ \ The **DocRefID** is a unique identifier for the document, i.e. one record and all its subordinate data elements. An element containing a correction or deletion must have a new unique DocRefID for future reference. For filing reports to **Germany**, Pillar 2 **generates and stores DocRefIds** when you create a report. When you create **correction reports** later, you can use these stored IDs to reference the original submission so you do not have to look them up or re-enter them. - **Safe Harbour and Excluded Entities**\ \ You can record **Transitional** and **Permanent Safe Harbour** elections via drop-down options; only one can be active at a time, so the GIR reflects your elections correctly. Safe Harbour elections are available for jurisdiction (no subgroup) and **Joint Venture** only. The XML export also indicates for each **Excluded Entity** whether its status or type changed compared to the last reporting period (using Prior Snapshot when linked), so tax authorities can see what has changed without comparing reports manually. #### Submission of Pillar 2 Reports to Tax Authorities Pillar 2 now supports the **submission of the GloBE Information Return (GIR) and Qualified Domestic Minimum Top-up Tax (QDMTT) reports** to tax authorities. The process covers submission of new returns as well as corrections and deletions. You can now: - Monitor which jurisdictions have submitted QDMTT data - Run and review calculations including entity-level allocations - Start and manage transmissions via the Tax Transfer Hub (TTH) - Review integrated GIR data - Correct or re-transmit filings - Override individual values when needed. > **Note:** The submission process is only available for reports that are sent to **German** tax authorities. #### New Recapture Mechanism With the new **Recapture mechanism** in Pillar 2, you can adjust the Effective Tax Rate (ETR) and top-up tax calculations when there are material decreases in covered taxes for a prior year. This corrects previously overstated covered taxes that may have reduced the top-up tax liability. For the **entity data collection**, a new **Recapture** workspace is available. You can enter and maintain all recapture data for the **Deferred Tax Liability (DTL)** in one place, i.e. annual amounts of DTLs subject to the recapture rule, aggregate recapture accounts for the reporting fiscal year, and aggregate recapture accounts for the prior fiscal year. The values you enter are used in **C2 – CE Calculations** and in **C4 – Jurisdictional Blending**. You can review recapture data at constituent-entity level in **C2** and at jurisdictional or subgroup level in **C4**. The data is available for the Pillar 2 XML report and supports the balance sheet comparison of Income Taxes, so you can meet the minimum requirements for reporting the DTL recapture mechanism. ### New in Version 260106 (Release date: 2026-01-16) Apart from bug fixes and performance enhancements, the release contains the following new features: #### Enhanced Safe Harbour Exclusions Lucanet now provides comprehensive **Safe Harbour exclusion capabilities** to streamline your compliance with Pillar 2 regulations. **Non-material entities** qualifying for NMCE Safe Harbour can be **excluded** from full-scope calculations, i.e. workspaces **C2 – CE Calculations**, **C4 – Jurisdictional Blending**, and **C5 – Top-up Tax Allocation** by activating the check box **EE-1** in the **Entity Election and General Information** workspace. Built-in validation warnings alert you when NMCE Safe Harbour is elected but not applicable, preventing potential compliance errors and improving workflow efficiency. #### Comprehensive Income Inclusion Rule Implementation Pillar 2 now features a **comprehensive calculation toolkit**: The **Income Inclusion Rule (IIR)** and the **Taxable Distribution method** for investment entities are now fully integrated, covering all essential Pillar 2 use cases: - The new **Income Inclusion Rule (IIR)** functionality ensures proper top-up tax allocation across your group structure. The enhanced C5 report intelligently displays only low-taxed constituent entities, automatically excluding entities from jurisdictions with zero or negative top-up tax. A new **Top-up Tax Allocation** workspace enables precise allocation to **Ultimate Parent Entities (UPE)**, **Partially Owned Parent Entities (POPE)**, and **Intermediate Parent Entities (IPE)** based on inclusion ratios. The calculation includes the new element **TA-4.1** for aggregating allocated amounts and updated **TA-5** formula for **QDMTT allocation**. - Lucanet now supports the **Taxable Distribution Method** election for constituent entity interests in investment entities. This method enables taxation of distributions at rates equal to or higher than the 15% global minimum tax rate. A new allocation workspace facilitates proper allocation of deemed distributions and local creditable tax gross-ups between investment entities and their owners. **Enhanced Entity Data Collection** captures **Taxable Distribution Method** elections and share percentages for undistributed net GloBE income. The **CE Calculation** includes new sections tracking undistributed net GloBE income and historical data, with proper exclusion of amounts from **Effective Tax Rate** calculations. Adjustments automatically impact **INC-2.24** and **CT-2.16**, ensuring accurate Pillar 2 compliance. #### Seamless Transition Rules From preparation through allocation to the **recapture of deferred taxes** – the **Transition Rules** are now mapped out in significantly greater detail, making practical implementation easier for you: - New **transition rule provisions** facilitate smooth adoption of the **global minimum tax framework**. These rules properly manage **deferred tax adjustments** when entities first become subject to GloBE rules, recognizing deferred tax assets at whichever rate is lower: the domestic tax rate or the 15% global minimum rate. The system handles pre-existing losses and timing differences to prevent artificially low **Effective Tax Rates** during initial GloBE application. Transitional safe harbours can exclude certain operations in initial years, reducing compliance burden while ensuring accurate calculations. - The new **Deferred Tax Liability (DTL) recapture functionality** ensures accurate adjustments to **Effective Tax Rate (ETR)** and **top-up tax calculations** when material decreases in deferred tax liabilities occur for prior years. A new **Recapture** workspace in the **Entity Data Collection** tracks DTLs subject to recapture rules across fiscal years, including amounts from the fifth preceding year and aggregate recapture accounts. The system automatically identifies and processes DTL adjustments in **C2 and C4 calculations**, correcting previously claimed deferred tax benefits that reduced top-up tax liability, ensuring compliance with OECD Pillar 2 recapture requirements. #### Redesign of Master Data The master data management of the **Tax Administration** module has been completely revised – your foundation for full XML reporting capability from mid-2026 onwards. > **Warning:** **Important Notice: Tax Administration Module Becomes Mandatory** > > The **Global Information Return (GIR)** reporting requires complete documentation of all changes in your ownership structure throughout the entire reporting period. To meet this requirement, Lucanet has developed a **timeline view** for company master data. > > Starting with release 260106, the **Tax Administration** module becomes a **mandatory component** and must be installed. This is where the timeline view will be activated for the first time, forming the foundation for your complete GIR reporting capability.