How CbCR Data Powers Pillar Two Compliance

Pillar Two’s computation (the GloBE rules) runs on the group’s jurisdictional data — and the data it runs on is, substantially, the CbCR data. The connection is structural, not incidental: the same group (the €750 mn scope), the same jurisdictional rows (the revenue, the profit, the tax, the employees, the assets), the same three-tier documentation (the CbCR, the Master File, the Local File) — the CbCR is the Pillar Two computation’s backbone, and the transitional CbCR safe harbour makes the connection literal: the CbCR ETR is the fast path’s test. This guide is the connection, and the data discipline it demands.

The shared scope

Element	The CbCR	The Pillar Two (GloBE)
The group threshold	Consolidated group revenue €750 mn (the base-year test) — the CbCR obligation’s trigger	Consolidated group revenue €750 mn (in at least one of the two preceding years) — the GloBE scope’s trigger
The group	The consolidated CbC group (the ultimate parent’s group, per the CbCR rules)	The consolidated CbC group (the same group, per the GloBE rules’ consolidation)
The jurisdictional rows	Per jurisdiction: the revenue (external/related), the profit before tax, the tax paid, the tax currently due, the employees, the tangible assets	Per jurisdiction: the ACI (the jurisdictional profit, adjusted), the covered taxes (the current and the deferred), the SBIE inputs (the qualified payroll, the qualified tangible assets)

The group in scope for one is in scope for the other — and the jurisdictional data the CbCR reports is the jurisdictional data the GloBE computation needs, before the GloBE adjustments. The CbCR is the computation’s input set: the jurisdictional profit (item 4) is the ACI’s starting point (before the GloBE adjustments), the tax data (items 5 and 6) is the covered taxes’ anchor (the current tax, before the deferred-tax adjustments), the employees and the assets (items 7 and 8) are the SBIE’s inputs (the qualified payroll’s source, the qualified tangible assets’ source).

The CbCR rows as the computation inputs

Per jurisdiction, the data flow from the CbCR row to the GloBE computation:

CbCR item	The GloBE use
Item 4 — the profit (loss) before income tax	The ACI’s starting point (the jurisdictional PBT) — the ACI = the CbCR profit ± the GloBE adjustments (the tax expense removal, the specified adjustments, the intercompany consistency)
Item 5 — the income tax paid (cash)	The covered taxes’ current-tax anchor (the tax actually paid) — the covered taxes = the current tax (the CbCR paid + the accrual position) ± the model rules’ adjustments (the deferred taxes, the credits, the specified items)
Item 6 — the income tax currently due (accrual)	The covered taxes’ accrual component (the tax due, per the accrual basis) — the item 5 + item 6 pair is the CbCR ETR (the safe harbour’s test) and the covered taxes’ anchor together
Item 7 — the number of employees	The SBIE’s qualified payroll’s source data (the headcount — the payroll cost is the payroll records’ data, the headcount the CbCR’s cross-check)
Item 8 — the tangible assets (net book value)	The SBIE’s qualified tangible assets’ source data (the NBEV — the fixed-asset register’s data, the CbCR’s cross-check, land excluded per the SBIE’s definition)

The flow’s reading: the CbCR row is the jurisdiction’s data snapshot, and the GloBE computation is the snapshot with the adjustments — the CbCR profit to the ACI (the adjustments), the CbCR tax to the covered taxes (the deferred, the credits), the CbCR employees/assets to the SBIE (the payroll cost, the NBEV, the land exclusion). The computation is built on the CbCR; the CbCR’s quality is the computation’s quality.

The data quality requirements

The CbCR data that powers the Pillar Two computation carries the quality standard the CbCR guide sets, with the Pillar Two overlay:

Requirement	The CbCR standard	The Pillar Two overlay
One source, all tiers	The CbCR rows, the Master File segment table, the Local File financials, the statutory accounts — one source, mapped identically	The ACI and the covered taxes reconcile to the CbCR rows (before the GloBE adjustments) and to the tax filings (the current tax, the deferred tax) — the reconciliation is the named step, documented
The tax data is the hard part	The tax paid (cash) and the tax currently due (accrual) — the provisions, the assessments, the pending items	The covered taxes’ anchor — the current tax as filed/paid, the deferred tax as computed per the tax return; the item 5/item 6 split (the cash vs the accrual) is the covered taxes’ starting position, and the split that does not reconcile to the filings is the covered taxes the authority recomputes
The related-party revenue	Item 3 (the related revenue) consistent with the Local Files’ transaction lists	The intercompany consistency — the related-party revenue is the controlled transactions’ volume, and the GloBE computation’s intercompany adjustments run on it; the gap between the CbCR related revenue and the Local File transactions is the finding
The PE allocation	The PEs’ data allocated to their jurisdictions	The PEs’ ACI and covered taxes, per the GloBE rules’ PE treatment — the PE allocation is the computation’s input, and the allocation’s consistency (the CbCR PE row, the Local File PE data) is the quality standard
The jurisdictional completeness	Every jurisdiction in the group’s footprint, a row	Every jurisdiction in the group’s footprint, the computation input — the jurisdiction missing from the CbCR is the jurisdiction missing from the computation, and the group’s footprint (the entities, the PEs) is the map’s completeness check

The through-line: the CbCR data quality is the Pillar Two computation’s defence — the computation that reconciles to the CbCR (and the CbCR reconciles to the filings) is the computation the authority cannot re-run into a different number. The data checklist is this discipline as the standing obligation.

The reconciliation that keeps the three tiers consistent

The three-tier documentation (the documentation pillar guide) carries the reconciliation, with the Pillar Two overlay:

Statutory accounts (the group consolidated)
  → CbCR rows (the jurisdictional split: the profit, the tax, the employees,
    the assets)                    [the CbCR filing]
  → Master File segment table (the segmental breakdown)   [the Master File]
  → Local File financials (the entity-level data)         [the Local Files]
  → GloBE computation (the ACI, the covered taxes, the SBIE,
    per jurisdiction)              [the Pillar Two computation]

The reconciliation’s steps, per the documentation cycle: the CbCR rows reconciled to the consolidated accounts (the jurisdictional split sums to the group), the Master File segment table reconciled to the CbCR (the segment data and the country data, one source), the Local File financials reconciled to the CbCR rows (the entity data and the jurisdiction data), and the GloBE computation reconciled to the CbCR rows (the ACI from the CbCR profit, the covered taxes from the CbCR tax, the SBIE from the CbCR employees/assets — before the adjustments, the snapshot match). The reconciliation documented — the step that is the data’s integrity proof, and the step the examination asks for first.

The group’s working position

1. The CbCR as the computation’s input set — the jurisdictional rows as the ACI/covered-taxes/SBIE starting points, the GloBE computation built on them, the adjustments documented from the snapshot.
2. The safe harbour on the CbCR ETR (years one to three) — the jurisdictional CbCR ETR test, per jurisdiction, per year — the fast path that runs on the CbCR data and makes the CbCR quality the safe harbour’s defence.
3. The reconciliation, per cycle — the CbCR to the accounts, the Master File to the CbCR, the Local Files to the CbCR, the computation to the CbCR — the documented step, the integrity proof.
4. The data discipline, standing — the payroll records (the SBIE payroll), the fixed-asset register (the SBIE assets, the land exclusion), the tax filings (the covered taxes’ anchor), the related-party schedules (the intercompany consistency) — the data checklist as the group’s standing data obligation, built in the transitional years for the steady state.

See also

• Pillar Two explained
• GloBE rules — the computation
• Transitional CbCR safe harbour
• The CbCR guide — the data standard