Substance Based Income Exclusion (SBIE) in Pillar Two

The Total Substance Based Income Exclusion values are now shown as positive in the Pillar Two Safe Harbors Overview form. Tax Reporting compares with routine profits to determine if the SBIE amount exceeds routine profits. If the SBIE amount exceeds routine profits, then the Safe Harbor test criteria is met.

The following additional improvements are made to the Pillar Two Safe Harbors Overview form to identity the results of all three tests and also the overall test with a value as 'Yes' and a green background if the test meets the criteria, otherwise it is left blank:

  • Transitional CbCR Safe Harbor Test fulfilled? - Indicates if Safe Harbors Test is fulfilled for an entity (that is, any one of the De Minimis, Simplified ETR or Routine Profit Tests are fulfilled) for an entity by marking the corresponding cell as 'Yes') 
  • Simplified ETR Test fulfilled? - Indicates if the Simplified ETR test is fulfilled for an entity by marking the corresponding cell as 'Yes' 
  • Routine Profit Test fulfilled? - Indicates if the Routine Profit test is fulfilled for an entity by marking the corresponding cell as 'Yes' 

NOTE:

  • The De Minimis Test Total Revenue, De Minimis Test Profit (Loss) Before Income Tax and Simplified ETR Test Rate values are added in the form.

  • Pillar Two De Minimus Test alias is now changed to De Minimis Test fulfilled?.

Business Benefit: This new capability corrects the SBIE signage for the Transitional Safe Harbor Form and adds a KPI indicating when Transitional Safe Harbor rules have been met.

Key Resources