Why BEPS 2.0 and Pillar Two matter
If you work in a multinational’s tax or finance team, you already know compliance isn’t getting easier. Between transfer pricing reviews, CbCR filings, and endless audit requests, most teams are stretched thin and thigs are only getting harder…
Here is 2025, a turning point for global tax rules and for every multinational’s transfer pricing strategy 2025. That’s when the OECD’s BEPS 2.0 package takes effect in many jurisdictions.
- Pillar Two introduces the 15% global minimum tax, reshaping how profits are tested and taxed and raising the stakes for global minimum tax compliance.
- Pillar One Amount B is coming into focus, aiming to simplify how baseline marketing and distribution functions are priced. And here’s the twist: unlike Pillar Two, there’s no revenue threshold baked into the guidance. That means even smaller international operators with these functions could find themselves in scope depending, of course, on whether their jurisdiction decides to adopt Amount B.
In short: the OECD is shaking up the rules for everyone.
The challenge is that many teams are still managing compliance with spreadsheets and scattered data. That might have worked in a looser environment, but under BEPS 2.0’s stricter standards, it’s a recipe for stress, inefficiency, and penalties.
2025 is the year when spreadsheet survival mode collapses. To thrive, companies need new ways to handle the pressure.
What are BEPS 2.0 and Pillar Two?
The OECD’s Base Erosion and Profit Shifting (BEPS) project is designed to update tax rules for today’s globalized, digitized economy. Old systems weren’t built for companies operating seamlessly across dozens of countries, shifting intellectual property and profits in ways that leave tax authorities scrambling.
The two pillars of BEPS 2.0
BEPS 2.0 has two main pillars:
- Pillar One redistributes taxing rights to reflect where value is created (important for digital economy giants). Within Pillar One, Amount B simplifies and standardizes pricing for marketing and distribution functions. And crucially, Amount B doesn’t just target large MNEs, it could affect any business with cross-border baseline distribution activities.
- Pillar Two, the star of this article, introduces the Global Anti-Base Erosion (GloBE) rules. The headline: a 15% global minimum corporate tax.
If a company’s effective tax rate (ETR) in a given jurisdiction falls below that 15% mark, it owes a top-up tax. Two rules enforce it:
- The Income Inclusion Rule (IIR): The jurisdiction of the Ultimate Parent Entity must impose the top-up tax.
- The Undertaxed Payments Rule (UTPR): A fallback if the IIR isn’t applied.
The Pillar Two rules apply to any multinational with annual consolidated revenue of EUR 750 million or more in at least two of the last four fiscal years.
How do Pillar Two rules impact transfer pricing strategies?
Transfer pricing has always been about allocating profits across entities and jurisdictions in a way that reflects business reality and that tax authorities will accept.
Now, Pillar Two ties those allocations directly to whether you clear the 15% minimum ETR.
That changes the game. A strategy that once looked efficient, like shifting profits to a low-tax jurisdiction can now pull your ETR below the line and trigger top-up taxes. Even if your strategy isn’t aggressive, you still need to prove compliance country by country, every year.
What does this mean?
In practice, this means:
- More scrutiny on how profits are distributed.
- More data to defend allocations.
- More pressure to rethink old approaches that no longer “work” under the new system.
A forward-looking transfer pricing strategy for 2025 must now balance efficiency with BEPS 2.0’s compliance realities.
What are the risks of relying on manual transfer pricing processes?
Here’s where the pain really sets in. Technically, you could try to tackle Pillar Two with Excel sheets, emails, and frantic late nights.
The risks of manual TP
But consider the risks:
- 300+ datapoints per country. That’s the volume of data your finance team needs to gather to run a full Pillar II analysis. Multiply by every jurisdiction where you operate, and you’re staring at a mountain of manual work.
- Education overload. A basic grasp of the rules won’t cut it. Teams need deep expertise in the Pillar II calculation model just to get started.
- Error-prone spreadsheets. Even with a well-trained team, manual Excel work is fragile. One wrong formula, one misplaced decimal, and your ETR calculation is off. Under Pillar Two, errors are costly.
- Reporting headaches. Compliance doesn’t stop at calculations. You need management reports to defend your Safe Harbour position to auditors, CFOs, and other stakeholders. Spreadsheets don’t build those automatically.
- Repetition, repetition, repetition. This isn’t a one-time exercise. Every year, every country, you have to repeat the process. The workload compounds.
So yes, you can survive Pillar Two manually. But the cost is stress, wasted resources, and sleepless nights wondering if your numbers will hold up under audit.
How can transfer pricing automation help you achieve Pillar Two compliance?
This is where automation saves the day. Instead of drowning in manual data collection, automation gives you real-time clarity and control.
What does automation do for you
Here’s what it delivers:
- Automated data collection: Pull data directly from ERP, CbCR, and local files. No more chasing departments for spreadsheets.
- Real-time ETR calculations: Instantly see which entities meet the 15% threshold and which don’t.
- Scenario analysis: Model how different transfer pricing strategies affect your Safe Harbour position before you act.
- Audit-ready reports: Generate consistent, transparent reports for stakeholders, auditors, and regulators.
- Version control: Track every adjustment, every calculation. No more mystery formulas.
- Time savings: Free your team from gathering 300+ datapoints for every jurisdiction year after year.
With Coperitas’ Safe Harbours module, transfer pricing automation becomes a practical reality. Our dashboard gives you a clear country-by-country overview of where you qualify for Safe Harbours. In those countries, you’re free from further Pillar II obligations. That’s less work, less risk, and a huge relief for already overstretched teams.
Where can you learn more about BEPS 2.0 and transfer pricing compliance?
BEPS 2.0 isn’t just about Pillar Two. Pillar One Amount B is right on its heels, and it will affect every company with cross-border marketing and distribution activities, not just the biggest players.
The risks of manual TP
If you want to stay ahead of these changes, we’ve got more resources for you:
- Blogs breaking down Pillar One Amount B.
- Guides on compliance efficiency.
- Insights into how tax technology can future-proof your strategy.
And if you’re done losing sleep over spreadsheets, it’s time to act.
Final thought
Whether it’s Pillar Two’s 15% minimum tax or Pillar One’s Amount B, the OECD is reshaping the rules of the game. Manual processes won’t cut it anymore. 2025 is the year to move from survival mode to smart, sustainable compliance.
