This article was first published on Tax@Hand, and is reproduced on this blog with the authorization of its authors.
The French tax authorities (FTA) published the first set of guidelines regarding the French Pillar Two rules on 8 October 2025 (BOI-IMG-DEF; BOI-IMG-CHAMP). These guidelines are in line with the OECD commentary.
As a reminder, for fiscal years beginning on or after 1 January 2024, the 15% global minimum level of taxation for multinational enterprise (MNE) groups is applicable in France (income inclusion rule (IIR) and qualified domestic minimum top-up tax (QDMTT)).
The guidelines clarify the definitions of various concepts (e.g., the notion of “interposed entities” includes “partnerships” referred to in article 8 of the French tax code (FTC), French consolidated accounts (ANC regulation 2020-01) constitute “qualified financial accounts,” the definition of “CFC regime” covers the French regime provided by article 209 B of the FTC and global intangible low-taxed income (GILTI)-type regimes), as well as the rules relating to the scope of Pillar Two and its territoriality.
The FTA has already indicated that further administrative guidance, currently being drafted, will address the following topics:
- Safe harbor rules;
- Methods for determining the effective tax rate (ETR);
- Computation of the top-up tax;
- Rules regarding the collection of the top-up tax;
- Rules regarding group reorganizations;
- Specific regimes;
- Transition rules applicable when an MNE group enters the scope of the Pillar Two rules;
- Filling and payment obligations; and
- Collection, audit, and litigation.
If the FTA follows the announced publication plan, the next administrative guidelines are expected to address the safe harbor rules.