The implementation of Pillar Two across the GCC is creating new responsibilities for multinational groups. With domestic minimum top-up tax regimes taking effect in several jurisdictions and the first reporting cycles approaching, Group CFOs and Tax Directors must ensure that local compliance requirements are supported by consistent financial data, clear accountability and coordinated tax processes.
The OECD's global minimum tax framework is designed to ensure that large multinational enterprise (MNE) groups, generally those with consolidated annual revenues of at least EUR 750 million under the applicable tests, are subject to a minimum effective tax rate of 15% in each relevant jurisdiction.
For groups operating across the GCC, implementation presents a particular challenge: the same multinational group may face different registration procedures, reporting requirements and compliance timelines across its regional entities.
Pillar Two across the GCC: where do countries stand?
The GCC tax landscape has evolved significantly since the introduction of the OECD/G20 Pillar Two framework. Five GCC jurisdictions have introduced global minimum tax mechanisms, although the applicable rules, administrative procedures and implementation dates differ.
The distinction between domestic top-up taxation and wider international Pillar Two mechanisms is important. A country may implement a domestic minimum tax without adopting every component of the OECD framework.
Businesses should therefore assess their obligations under each applicable jurisdiction's legislation rather than treating Pillar Two as a single regional tax regime.
One multinational group, different compliance obligations
Consider a multinational group headquartered outside the GCC, with subsidiaries in the UAE, Bahrain, Qatar and Kuwait, alongside operations in Saudi Arabia.
Even where the group has a centralised tax function, its regional entities may have different registration requirements, filing processes and reporting obligations.
A consolidated group-level tax calculation alone may not provide the information necessary to satisfy every local authority.
The following areas require particular attention:
Registration and designated entities
Different jurisdictions require groups to identify local entities responsible for registration, communication with tax authorities or filing. In Qatar, for example, the Pillar Two registration framework requires the appointment of a Designated Local Entity. Oman’s amended legislation also requires in-scope entities to register with the Tax Authority and appoint a Designated Filing Entity responsible for coordinating local compliance obligations
Financial data and calculation methods
Effective tax rate calculations depend on detailed financial information, including GloBE income or loss, covered taxes and relevant adjustments. Existing statutory accounts or corporate tax returns may not contain all the information required.
Reporting calendars
Groups must coordinate local obligations with international reporting requirements, including the GloBE Information Return (GIR), where applicable. The availability of centralised filing or information exchange does not automatically eliminate domestic obligations. Oman's amended legislation, for example, requires the submission of both a local Top-Up Tax Return and a Pillar Two Information Return, making coordination between local and group-level reporting particularly important.
Documentation and internal controls
Calculations, elections, safe harbour assessments and supporting information must be appropriately documented. Internal review and approval procedures become particularly important where several jurisdictions contribute to the same group's Pillar Two position.
For Group CFOs, these requirements create a need for clear regional governance and reliable information flows between local finance teams and the central tax function.
The immediate priorities: five GCC markets preparing for Pillar Two compliance
Although Pillar Two implementation is a regional development, some compliance requirements warrant particular attention before 2027.
UAE: registration and compliance readiness
The UAE's Domestic Minimum Top-up Tax applies to in-scope multinational groups for financial years beginning on or after 1 January 2025.
FTA Decision No. 12 of 2026 provides registration, deregistration and notification requirements. A transitional registration deadline of 30 November 2026 applies to qualifying entities whose first in-scope financial year ended before 30 April 2026.
Businesses should review which entities fall within scope, determine whether a Domestic Designated Filing Entity should be appointed and establish responsibility for ongoing reporting.
Qatar: registration through Dhareeba
Qatar introduced its Global and Domestic Minimum Tax framework for financial years beginning on or after 1 January 2025.
The General Tax Authority launched Pillar Two registration through the Dhareeba platform on 2 August 2026. On 4 November 2026, the Authority announced an extension of the registration deadline from 2 November 2026 to 31 January 2027.
Registration obligations may apply even where no top-up tax is ultimately payable.
Groups must identify the relevant constituent entities, determine the Designated Local Entity and coordinate local registration with their wider reporting arrangements.
Bahrain: preparing for the first DMTT return
Bahrain has introduced DMTT for qualifying multinational groups, supported by guidance from the National Bureau for Revenue.
The DMTT Return Filing Manual published in August 2026 provides practical information on the filing process, including the return, information schedules and tax computations.
For an in-scope group with a financial year ending on 31 December 2025, 30 June 2027 is the expected first filing deadline under the transitional timetable, subject to confirmation of the applicable administrative requirements.
Businesses should use the remaining preparation period to validate their calculations, supporting documentation, payment obligations and internal approval processes.
Kuwait: connecting calculations with reporting
Kuwait's DMTT regime applies to qualifying multinational groups for financial years beginning on or after 1 January 2025.
The framework requires attention to group registration, designated entities, tax computations and related-party transactions.
For multinational groups, an important priority is consistency between the Kuwait DMTT calculation and information maintained centrally for Pillar Two purposes.
This includes reviewing transfer pricing adjustments, relevant tax elections, safe harbour eligibility and supporting documentation
Oman: new compliance obligations under the amended Top-Up Tax Law
On 29 October 2026, Oman issued Royal Decree No. 101/2026, introducing significant amendments to its Pillar Two Top-Up Tax Law. The revised framework retains the Domestic Minimum Top-up Tax (DMTT) as the sole charging mechanism, removing the Income Inclusion Rule (IIR), with key provisions applying retrospectively to financial years beginning on or after 1 January 2025.
The amendments establish requirements for registration, the appointment of a Designated Filing Entity, tax return submissions and payments. In-scope entities are generally required to register within 120 days of becoming subject to the tax, while the standard filing deadline is 15 months after the end of the reporting financial year.
Multinational groups operating in Oman should review their registration status, assess local filing responsibilities and prepare for the first compliance cycle. Further details on implementation procedures and applicable transitional arrangements are expected through the Executive Regulations.
Five questions every Group CFO should ask before 2027
As the first compliance cycles progress, businesses should evaluate the operational readiness of their existing tax and finance processes.
These questions should form part of a broader tax governance review, particularly for groups with decentralised finance operations or multiple regional subsidiaries.
From tax calculations to regional tax governance
Pillar Two compliance also has implications beyond the tax department
Financial reporting and forecasting
Additional tax exposure may affect financial projections, tax provisioning and disclosures. Finance teams should evaluate whether potential top-up tax liabilities are appropriately reflected in their reporting processes.
Transfer pricing and intercompany arrangements
Cross-border transactions and related-party pricing may influence the allocation of income and taxes across jurisdictions. Pillar Two calculations should therefore be coordinated with existing transfer pricing policies and documentation
Technology and data management
Groups should assess whether existing ERP, consolidation and tax reporting systems can capture the information required for Pillar Two calculations. Depending on organisational complexity, additional controls, reporting tools or process improvements may be necessary.
Governance and accountability
A coordinated compliance framework should establish responsibilities for data preparation, calculation review, tax elections, documentation and final approval.
The objective is to create a repeatable process that can support future reporting cycles as legislation and administrative guidance continue to evolve.
What multinational groups should prioritise for 2027
The OECD continues to refine the Pillar Two framework. In September 2026, it released updated GloBE Information Return materials and additional administrative guidance, highlighting the continuing importance of consistent interpretation and reporting.
For multinational groups operating in the GCC, the following actions should be prioritised:
How BDO can help
Managing Pillar Two across several jurisdictions requires both international tax expertise and a practical understanding of local compliance requirements.
BDO tax professionals can support multinational groups with:
Speak to BDO's tax professionals to assess your multinational group's regional obligations, identify preparation gaps and develop a coordinated approach to Pillar Two compliance.
The OECD's global minimum tax framework is designed to ensure that large multinational enterprise (MNE) groups, generally those with consolidated annual revenues of at least EUR 750 million under the applicable tests, are subject to a minimum effective tax rate of 15% in each relevant jurisdiction.
For groups operating across the GCC, implementation presents a particular challenge: the same multinational group may face different registration procedures, reporting requirements and compliance timelines across its regional entities.
Pillar Two across the GCC: where do countries stand?
The GCC tax landscape has evolved significantly since the introduction of the OECD/G20 Pillar Two framework. Five GCC jurisdictions have introduced global minimum tax mechanisms, although the applicable rules, administrative procedures and implementation dates differ.
| Country | Pillar Two position | Key consideration for multinational groups |
| UAE | Domestic Minimum Top-up Tax (DMTT) applies for financial years beginning on or after 1 January 2025 | Determine applicable registration deadlines, identify filing responsibilities and prepare UAE top-up tax calculations |
| Bahrain | DMTT applies for financial years beginning on or after 1 January 2025 | Prepare for the first filing cycle, including calculations, supporting schedules and advance payment requirements |
| Qatar | Domestic Minimum Top-up Tax (DMTT) and Income Inclusion Rule (IIR) apply for financial years beginning on or after 1 January 2025 | Complete applicable registration through Dhareeba and establish local reporting responsibilities |
| Kuwait | DMTT applies for financial years beginning on or after 1 January 2025 | Align local calculations, transfer pricing documentation and compliance reporting with group-level requirements |
| Oman | DMTT applies to in-scope multinational groups for financial years beginning on or after 1 January 2025. Royal Decree No. 101/2026 confirms DMTT as the sole charging mechanism, removing the IIR. | Assess registration and designated filing entity requirements, prepare for local tax returns and payments, and review compliance obligations under the amended law. |
| Saudi Arabia | No equivalent enacted Pillar Two regime has been identified as of October 2026 | Assess potential exposure through overseas subsidiaries, parent entities and other jurisdictions applying Pillar Two |
The distinction between domestic top-up taxation and wider international Pillar Two mechanisms is important. A country may implement a domestic minimum tax without adopting every component of the OECD framework.
Businesses should therefore assess their obligations under each applicable jurisdiction's legislation rather than treating Pillar Two as a single regional tax regime.
One multinational group, different compliance obligations
Consider a multinational group headquartered outside the GCC, with subsidiaries in the UAE, Bahrain, Qatar and Kuwait, alongside operations in Saudi Arabia.
Even where the group has a centralised tax function, its regional entities may have different registration requirements, filing processes and reporting obligations.
A consolidated group-level tax calculation alone may not provide the information necessary to satisfy every local authority.
The following areas require particular attention:
Registration and designated entities
Different jurisdictions require groups to identify local entities responsible for registration, communication with tax authorities or filing. In Qatar, for example, the Pillar Two registration framework requires the appointment of a Designated Local Entity. Oman’s amended legislation also requires in-scope entities to register with the Tax Authority and appoint a Designated Filing Entity responsible for coordinating local compliance obligations
Financial data and calculation methods
Effective tax rate calculations depend on detailed financial information, including GloBE income or loss, covered taxes and relevant adjustments. Existing statutory accounts or corporate tax returns may not contain all the information required.
Reporting calendars
Groups must coordinate local obligations with international reporting requirements, including the GloBE Information Return (GIR), where applicable. The availability of centralised filing or information exchange does not automatically eliminate domestic obligations. Oman's amended legislation, for example, requires the submission of both a local Top-Up Tax Return and a Pillar Two Information Return, making coordination between local and group-level reporting particularly important.
Documentation and internal controls
Calculations, elections, safe harbour assessments and supporting information must be appropriately documented. Internal review and approval procedures become particularly important where several jurisdictions contribute to the same group's Pillar Two position.
For Group CFOs, these requirements create a need for clear regional governance and reliable information flows between local finance teams and the central tax function.
The immediate priorities: five GCC markets preparing for Pillar Two compliance
Although Pillar Two implementation is a regional development, some compliance requirements warrant particular attention before 2027.
UAE: registration and compliance readiness
The UAE's Domestic Minimum Top-up Tax applies to in-scope multinational groups for financial years beginning on or after 1 January 2025.
FTA Decision No. 12 of 2026 provides registration, deregistration and notification requirements. A transitional registration deadline of 30 November 2026 applies to qualifying entities whose first in-scope financial year ended before 30 April 2026.
Businesses should review which entities fall within scope, determine whether a Domestic Designated Filing Entity should be appointed and establish responsibility for ongoing reporting.
Qatar: registration through Dhareeba
Qatar introduced its Global and Domestic Minimum Tax framework for financial years beginning on or after 1 January 2025.
The General Tax Authority launched Pillar Two registration through the Dhareeba platform on 2 August 2026. On 4 November 2026, the Authority announced an extension of the registration deadline from 2 November 2026 to 31 January 2027.
Registration obligations may apply even where no top-up tax is ultimately payable.
Groups must identify the relevant constituent entities, determine the Designated Local Entity and coordinate local registration with their wider reporting arrangements.
Bahrain: preparing for the first DMTT return
Bahrain has introduced DMTT for qualifying multinational groups, supported by guidance from the National Bureau for Revenue.
The DMTT Return Filing Manual published in August 2026 provides practical information on the filing process, including the return, information schedules and tax computations.
For an in-scope group with a financial year ending on 31 December 2025, 30 June 2027 is the expected first filing deadline under the transitional timetable, subject to confirmation of the applicable administrative requirements.
Businesses should use the remaining preparation period to validate their calculations, supporting documentation, payment obligations and internal approval processes.
Kuwait: connecting calculations with reporting
Kuwait's DMTT regime applies to qualifying multinational groups for financial years beginning on or after 1 January 2025.
The framework requires attention to group registration, designated entities, tax computations and related-party transactions.
For multinational groups, an important priority is consistency between the Kuwait DMTT calculation and information maintained centrally for Pillar Two purposes.
This includes reviewing transfer pricing adjustments, relevant tax elections, safe harbour eligibility and supporting documentation
Oman: new compliance obligations under the amended Top-Up Tax Law
On 29 October 2026, Oman issued Royal Decree No. 101/2026, introducing significant amendments to its Pillar Two Top-Up Tax Law. The revised framework retains the Domestic Minimum Top-up Tax (DMTT) as the sole charging mechanism, removing the Income Inclusion Rule (IIR), with key provisions applying retrospectively to financial years beginning on or after 1 January 2025.
The amendments establish requirements for registration, the appointment of a Designated Filing Entity, tax return submissions and payments. In-scope entities are generally required to register within 120 days of becoming subject to the tax, while the standard filing deadline is 15 months after the end of the reporting financial year.
Multinational groups operating in Oman should review their registration status, assess local filing responsibilities and prepare for the first compliance cycle. Further details on implementation procedures and applicable transitional arrangements are expected through the Executive Regulations.
Five questions every Group CFO should ask before 2027
As the first compliance cycles progress, businesses should evaluate the operational readiness of their existing tax and finance processes.
| Board-level question | Why it matters |
| 1. Do we have a complete picture of our Pillar Two exposure across the GCC? | An incomplete entity assessment may result in missed registrations, reporting obligations or tax exposures |
| 2. Can our finance systems produce reliable data for local and group-level calculations? | Different accounting records and inconsistent data definitions can complicate effective tax rate calculations |
| 3. Have we assessed available safe harbours and relevant elections? | Eligible simplifications may reduce compliance complexity, but require appropriate analysis and documentation |
| 4. Who owns Pillar Two compliance in each jurisdiction? | Clearly assigned responsibilities help prevent gaps between local finance teams, group tax and external advisers |
| 5. Are our reporting processes ready for the first filing cycles? | Calculations, reviews, approvals and submissions must operate within different local and international deadlines |
These questions should form part of a broader tax governance review, particularly for groups with decentralised finance operations or multiple regional subsidiaries.
From tax calculations to regional tax governance
Pillar Two compliance also has implications beyond the tax department
Financial reporting and forecasting
Additional tax exposure may affect financial projections, tax provisioning and disclosures. Finance teams should evaluate whether potential top-up tax liabilities are appropriately reflected in their reporting processes.
Transfer pricing and intercompany arrangements
Cross-border transactions and related-party pricing may influence the allocation of income and taxes across jurisdictions. Pillar Two calculations should therefore be coordinated with existing transfer pricing policies and documentation
Technology and data management
Groups should assess whether existing ERP, consolidation and tax reporting systems can capture the information required for Pillar Two calculations. Depending on organisational complexity, additional controls, reporting tools or process improvements may be necessary.
Governance and accountability
A coordinated compliance framework should establish responsibilities for data preparation, calculation review, tax elections, documentation and final approval.
The objective is to create a repeatable process that can support future reporting cycles as legislation and administrative guidance continue to evolve.
What multinational groups should prioritise for 2027
The OECD continues to refine the Pillar Two framework. In September 2026, it released updated GloBE Information Return materials and additional administrative guidance, highlighting the continuing importance of consistent interpretation and reporting.
For multinational groups operating in the GCC, the following actions should be prioritised:
- Confirm the scope of application. Identify relevant entities, jurisdictions, group structures and potential exclusions.
- Develop a consolidated compliance calendar. Include registration, notification, filing and payment obligations across relevant jurisdictions, taking into account transitional arrangements and retrospectively applicable provisions where relevant.
- Assess data readiness. Identify information gaps between statutory reporting, tax records and Pillar Two calculations.
- Review safe harbour eligibility. Evaluate available simplifications and applicable elections under the relevant rules.
- Establish clear governance. Assign responsibilities for preparation, review, approval and coordination with local tax authorities.
- Monitor regulatory developments. Maintain visibility over new guidance and changes affecting the group's reporting obligations.
How BDO can help
Managing Pillar Two across several jurisdictions requires both international tax expertise and a practical understanding of local compliance requirements.
BDO tax professionals can support multinational groups with:
- Pillar Two impact assessments: identifying entities in scope, evaluating potential top-up tax exposure and assessing available reliefs.
- Regional compliance coordination: supporting local registration, reporting obligations and alignment of compliance calendars.
- Effective tax rate calculations and modelling: evaluating the financial implications of the global minimum tax framework.
- Tax data and technology readiness: assessing reporting systems, data requirements and opportunities to strengthen calculation and documentation processes.
- International tax and transfer pricing advisory: reviewing cross-border arrangements and their interaction with Pillar Two requirements.
Speak to BDO's tax professionals to assess your multinational group's regional obligations, identify preparation gaps and develop a coordinated approach to Pillar Two compliance.