Luxembourg

Pillar Two - Clarification of filing obligations (Luxembourg FAQ - June 2026)

The Luxembourg tax authorities released an updated FAQ on 19 June 2026 providing important clarifications on the practical application of Pillar Two filing obligations for first year filings.

The FAQ confirms a streamlined framework built around the interaction of registration, the Global Anti-Base Erosion (GloBE) Information Return (GIR), and local top-up tax filings. Luxembourg endorses a centralised GIR filing approach, allowing groups to rely on a filing in another jurisdiction where the conditions in relation to automatic exchange of the GIR are met. This approach is combined with a notification requirement embedded in the registration process. A temporary administrative tolerance for GIR filing applies until 31 December 2026 for jurisdictions where information exchange is not yet fully operational, mitigating the need for duplicate filings provided that the GIR is ultimately shared with Luxembourg.

It also clarifies that Luxembourg top-up tax filings are not automatic but arise where Luxembourg entities are allocated tax under the Income Inclusion Rule (IIR), Undertaxed Profits Rule (UTPR) or Qualified Domestic Minimum Top-up Tax (QDMTT), with nevertheless limited cases requiring nil returns. The guidance confirms the possibility to centralise filings with a designated Luxembourg entity, reinforcing a targeted and pragmatic compliance framework and prompting groups to focus on registration and assessing potential top-up tax exposure in Luxembourg.