Pillar Two registration lessons and next steps

By Angus Isherwood, Young Jin Kim & Annamaria Maclean

30 June 2026 marked the first Pillar Two registration deadline for multinational enterprise (MNE) groups with a 31 December balance date with operations in New Zealand. As expected with the introduction of a new legislative framework, the first round of Pillar Two registration presented some practical challenges that needed to be worked through. Nevertheless, a significant number of registrations were successfully completed by the deadline.

Attention now turns to the next major registration deadline: 30 September 2026 for MNE groups with a 31 March balance date.

Based on our experience with the first round of Pillar Two registrations, we outline below the key practical lessons and considerations for groups that have registered or are preparing to register.

• Keep registration details up to date: The information provided at registration remains effective until it is amended. The MNE group or its designated filing entity is responsible for promptly updating the registration if any registered details change. Updates may be required where there is:
  • A new ultimate parent entity
  • A change in the entity filing the GloBE Information Return (GIR)
  • Changes to the New Zealand constituent entities included in the registration
  • Where the registered Group is no longer subject to the GloBE rules.

• Late registrations: Inland Revenue is actively identifying MNE groups that may be required to register under the Pillar Two rules and following up where registration has not occurred by the deadline. For any late registration, Inland Revenue expects an explanation for the delay. Failure to register could result in a penalty of up to NZD100,000.
• Early action required for 30 June MNE groups: MNE groups with a 30 June balance date must register for Pillar Two in New Zealand by 31 December 2026. As this deadline coincides with the Christmas/New Year holiday office closure period, Groups should plan ahead and complete their registrations early. Inland Revenue does not currently intend to extend the deadline.
• Joint Ventures: Inland Revenue has confirmed that joint ventures (JVs) should not be included as a constituent entity in the registration if the JVs are accounted for under the equity method in the MNE group’s consolidated financial statements. The JVs will be separately disclosed in the GloBE information return (GIR).
• Permanent Establishments: New Zealand permanent establishments (PEs) of an entity which are included in the MNE Group’s consolidated financial statements on a line-by-line basis (i.e. consolidated) are constituent entities in their own right and should be separately included in the registration.
• In-scope for part year: It has been confirmed that MNE groups must register even when they are only in scope for a part year. This includes when an MNE group is disposing of or dissolving its New Zealand operations.
• Change of UPEs: Where the UPE of the MNE group changes during the first fiscal year of registration, as part of the notification process, Inland Revenue expects the filing entity to submit the registration with details of both the old and new UPE’s information.

In our experience, Inland Revenue encourages early engagement where unusual circumstances or complexities may delay registration. Raising these issues before the deadline is generally more likely to lead to a better outcome than providing an explanation for a late registration upon request.

For further information on Pillar Two registrations, please refer to our earlier Tax Alert FAQ article.

Updates in the tax bill: Annual Multinational top-up tax return

The recently released Taxation (Annual Rates for 2026-27, FBT Simplification, Foreign Investment Funds, and Remedial Measures) Bill (the Bill) provides further clarity on the multinational top-up tax return (MTTR) filing requirements. MTTRs are the next major New Zealand compliance obligation for in-scope entities, with the first filing deadline falling on 31 August 2027 for MNE groups with a 31 December balance date.

The Bill has now provided some additional details on the MTTR filing requirements, most of which is welcome news for in-scope MNE groups as it should significantly reduce compliance costs.

In summary, the proposed changes in the Bill are as follows:

• A MTTR will not be required where New Zealand constituent entities of in-scope MNE Groups have no top-up tax liability (for example, where top-up tax is only payable under another jurisdiction's Income Inclusion Rule (IIR)).
• Where a MTTR is required, a single top-up tax return can be filed by a designated filing entity, on behalf of all group entities with a top-up tax liability.
• A remedial to allow the transitional UTPR safe harbour rules to apply, as intended, to MNE Groups with 52/53 week fiscal years

The commentary on the Bill also confirms that, where a MNE Group is not required to file an MTTR in New Zealand, the Group’s GIR will be treated as that entity’s assessment. The time bar for amending the assessment should run from the date the GIR is filed. However, where the GIR is filed in another country then the taxpayer needs to ensure that the foreign competent authority is obliged to exchange that information with New Zealand (under a Qualifying Competent Authority Agreement) to ensure the time bar applies.

We are also requesting additional guidance on how the MTTR filing requirement may apply to Partially Owned Parent Entities (POPEs) or New Zealand headquartered MNE Groups.

If you have any questions about Pillar Two registrations or proposed changes in the Bill, please contact your usual Deloitte adviser.