The OECD Pillar Two minimum tax is no longer a thought experiment. With 21 EU member states now applying the 15% global minimum effective tax rate, mobility teams need to revisit tax equalisation models that were calibrated on pre-2024 effective rates.
Why this matters for assignments
Tax equalisation assumes a stable hypothetical home-country tax. When the home entity's effective rate is topped up under Pillar Two, the cost of the assignment to the employer rises, but the assignee's net pay doesn't change. Finance and mobility need a shared view of the new fully-loaded cost.
What to recalibrate
- Hypothetical tax tables for the top 5 home countries in your population
- Cost projections shared with the business sponsor
- Gross-up factors for tax-protected populations
- Year-end true-up timing — earlier is better in 2026
Documentation, not just numbers
Assignment letters drafted before 2024 often reference a fixed effective tax rate. Update template language to reference 'home-country tax as calculated annually' and avoid locking the company into outdated math.
We'll review a country corridor and flag any compliance gaps.
Request a reviewWatch list
- Romania — domestic Pillar Two rules in consultation
- Switzerland — QDMTT applies from FY2026
- UK — multinational top-up tax already in force
