by Ariful | Sep 14, 2026 | Banking
Hold more currencies and reduce avoidable FX costs
Stripe expands multi-currency settlement to 37 markets
Stripe is expanding multicurrency settlement so businesses in 37 markets will be able to settle payment earnings in up to 18 currencies by the end of 2026, depending on their location and eligibility.
Stripe has also introduced instant currency conversion. Businesses can convert funds between 15 currencies through the Dashboard, API or mobile interface. The feature operates 24/7, with real-time rates and no weekend surcharge, according to Stripe’s announcement.
This matters because international businesses often face the “double FX trap”:
- Customer payments are converted into the business’s home currency.
- The business later converts funds back to pay an overseas supplier or contractor.
- The company pays conversion costs twice.
Action for your business:
- List the currencies your customers pay in.
- Identify the currencies used for suppliers, payroll and advertising.
- Keep funds in the original currency where practical.
- Convert only when you have a genuine operating need.
- Reconcile each settlement against your payment platform and bank records.
This can reduce unnecessary FX leakage. However, you must still record the correct sterling value of transactions and track realised or unrealised exchange differences for your accounts.
Razorpay introduces foreign-currency settlement for exporters
Razorpay’s Multi-Currency EEFC Account enables exporters to receive settlements directly in USD, EUR, GBP, AED and SGD, without immediate conversion into Indian rupees.
The Razorpay newsroom release explains that the account is designed to reduce repeated conversion cycles and give businesses more control over when they convert foreign earnings. The official release was published in August and updated on 7 September 2026.
The wider lesson is relevant to any international seller: your payment account should match your cash-flow needs. A multi-currency business account can be valuable when you regularly receive and spend in the same foreign currency.
Keep a currency-by-currency schedule showing:
- Opening balance.
- Payments received.
- Refunds and chargebacks.
- Supplier payments.
- Bank or platform fees.
- FX conversions.
- Closing balance.
This structure makes ecommerce bookkeeping UK businesses easier to review and helps your accountant identify missing transactions.
Nu Global combines US banking with stablecoin-based transfers
Nu has launched in the United States through a partnership with FDIC-insured Lead Bank. At the same time, it introduced Nu Global, a multi-currency account using USDC and EURC to support transfers across more than 35 countries.
According to Nu’s Business Wire announcement, the product is aimed at customers with international financial needs. It is initially focused on Europe and Latin America and includes a virtual Mastercard.
For SMEs, stablecoin-linked accounts may offer faster settlement and lower transfer costs. They also require careful records. Treating every movement as a simple bank transfer could create errors in your bookkeeping, especially where balances are converted, spent or exchanged.
Record the asset, currency, value and transaction date for every movement. Keep platform statements and conversion records so your accounts can be supported later.
Aspire links a multi-currency account with Mastercard spending
Aspire has commercially launched an enhanced multi-currency business account integrated with a Mastercard World Business Debit Card.
The announcement reported through Investegate describes a combined platform for:
- Multi-currency account management.
- Domestic and international payments.
- Foreign exchange.
- Payroll and direct debits.
- Supplier payments.
- Business debit-card spending.
- Trade finance of up to £5 million for eligible customers.
The benefit is operational consolidation. You may not need separate providers for an account, card, FX and selected working-capital services.
The control requirement is equally important. Set clear spending rules and reconcile card transactions weekly. This prevents duplicated expenses, uncategorised payments and VAT errors.
Access working capital using live sales data
Ping An Digital Bank offers purchase-order financing for ecommerce SMEs
Ping An Digital Bank has launched collateral-free Purchase Order Financing for cross-border ecommerce businesses. Eligible merchants may receive up to 95% of accounts receivable, with facilities of up to US$5 million and approval and drawdown as fast as T+1 business day.
The product uses real-time sales data from cross-border buyers and platforms rather than relying only on traditional financial statements. Details are reported by The Asian Banker.
The 95% advance rate and T+1 timing are maximum parameters, not guaranteed terms for every applicant.
Prepare your business before applying:
- Keep platform sales data complete and consistent.
- Reconcile orders, refunds and chargebacks.
- Maintain accurate aged receivables.
- Separate revenue by market and currency.
- Track inventory commitments against available cash.
- Store customer and buyer documentation securely.
Good ecommerce bookkeeping is now part of your funding infrastructure. Accurate data can support lending decisions, while incomplete records may delay or weaken an application.
iwoca brings loans of up to £1 million to Starling users
Starling Bank customers can now apply for iwoca business loans from within the Starling app or online banking. The facility ranges from £1,000 to £1 million, with terms from one day to five years and no early repayment fees.
As iwoca explains, iwoca provides and manages the loan. Starling provides the cus
by Ariful | Sep 14, 2026 | E-Commerce
## The week commencing 14 September 2026 brings important accounting, fulfilment and cross-border compliance actions for Amazon and Shopify sellers.
If you are looking for an **ecommerce accountant in the UK**, an **Amazon seller accountant UK** service, or structured **Shopify accounting UK** support, your priority should be accurate daily records. This means reconciling marketplace settlements, tracking VAT correctly, recording fulfilment costs and preparing for filing deadlines before they become urgent.
Prepare your Amazon FBA accounts for peak-season costs
Amazon’s UK festive season peak fulfilment fee applies from **15 October 2026 to 14 January 2027** for selected FBA orders.
For UK sellers, the fee applies to:
- Small and standard parcels fulfilled through local UK FBA.
- Large and extra-large envelopes.
- Remote Fulfilment orders from the EU to the UK.
The average additional charge is:
- £0.12 per parcel item.
- £0.07 per large or extra-large envelope item.
The fee does not apply to oversize items, Low-Price FBA items, apparel, or items delivered to buyers in other EU countries. The fee is determined when units leave the fulfilment centre, based on the ship date.
You should also include Amazon’s separate **1.5% fuel and logistics-related surcharge** in your calculations. This surcharge has applied year-round since **17 April 2026** and continues on top of the festive peak fee.
Do not rely on headline fee estimates. Review the exact impact on each SKU using Amazon’s Revenue Calculator and the FBA Fee Preview report. Then update your product margin reports and cash-flow forecasts.
This is essential for accurate **Amazon FBA accounting UK**. A product can appear profitable before fulfilment, storage, referral, advertising and peak-season charges are reconciled.
Track Amazon’s Q4 deadlines before inventory becomes expensive
Amazon’s key UK deadlines are now close.
For Prime Big Deal Days:
- Deal submissions remain open until **23 September 2026**.
- UK inventory should arrive by **16 September 2026** to support Prime badge eligibility.
For Black Friday Week:
- Deal submissions remain open until **18 November 2026**.
- UK inventory should arrive by **28 October 2026** to support Prime badge eligibility.
UK promotion fees include:
- £12 upfront per promotion.
- 0.75% of promotional sales, capped at £600.
Prime Exclusive Discounts also require a minimum product rating of **3.5**.
Record each promotion fee separately in your bookkeeping system. Do not combine Amazon promotion costs with general advertising. Separating these costs helps you measure the true return from each campaign and supports cleaner year-end accounts.
Amazon’s fulfilment centres typically focus on receiving inventory during September and October before shifting towards order processing in November and December. Inbound delivery slots can become limited, so use Capacity Manager and monitor your available receiving dates.
Keep FBM delivery data and customs records accurate
From **30 September 2026**, Amazon.co.uk sellers using Fulfilment by Merchant must maintain a business-hour delivery rate of at least **90%** for Amazon Business customers.
From **30 October 2026**, Amazon may deactivate listings for business customers where the requirement is not met.
Review your:
- Dispatch timestamps.
- Carrier collection records.
- Delivery confirmations.
- Business-hour delivery performance.
- Handling-time settings.
From **1 September 2026**, Amazon may enable Automated Handling Time for SKUs where the set handling time has exceeded actual performance for more than 30 days. Account-level default handling time settings now show only zero-day and one-day options, following the change introduced on **15 July 2026**.
For shipments under €150 imported under IOSS, new EU Customs Reform requirements also mean you must use approved couriers and provide Amazon’s IOSS number and the relevant ASIN details for each product.
Keep customs evidence with your sales records. This will help you reconcile import charges, identify the correct importer and respond quickly if Amazon or a customs authority requests documentation.
Monitor the proposed UK marketplace VAT liability rules
HMRC’s consultation on extending online marketplace VAT liability closed on **18 August 2026**. HMRC is now evaluating feedback, and legislation may follow in Finance Bill 2026–27.
The proposal would potentially make marketplaces jointly or fully liable for VAT on certain sales by UK-established sellers. This would extend the existing approach used for some overseas sellers since 2021.
The consultation targets VAT under-declaration and missing-trader behaviour, including:
- B2C sales incorrectly classified as B2B.
- Sellers fragmenting activity across multiple marketplace accounts.
- VAT not being declared on digital marketplace sales.
Nothing has changed in law yet. Continue applying the current VAT rules and maintain your own transaction records.
Read the full HMRC online marketplace VAT liability consultation. The practical lesson is simple: do not depend solely on marketplace reports. Keep a complete record of sales, refunds, VAT treatment, customer type and stock location.
Review MTD requirements for qualifying ecommerce income
HMRC began auto-enrolling eligible sole traders with qualifying income above £50,000 from September 2026 for the 2026/27 phase of Making Tax Digital for Income Tax.
The second quarterly update for 2026/27 is due by **7 November 2026**. You must keep digital records and use compatible software.
If you operate an ecommerce business as a sole trader, review your 2024/25 qualifying income and confirm whether MTD applies to you. Include marketplace and direct-store income in your records, then reconcile the figures to bank deposits and payment processor reports.
Use HMRC’s MTD eligibility guidance to check your position.
Completing reconciliations weekly will reduce the risk of missing income, duplicating sales or submitting incomplete quarterly updates.
Apply the new UK VAT group refund process correctly
HMRC Revenue and Customs Brief 8 (2026), published on **8 September 2026**, changes how non-UK businesses in a UK VAT group claim UK VAT refunds.
A non-UK business that incurred the VAT must now submit its own refund claim. The UK VAT group’s representative member cannot claim the VAT unless it incurred that cost itself.
For the prescribed year from **1 July 2025 to 30 June 2026**, transitional arrangements allow claims from either:
- The individual non-UK group member that incurred the VAT.
- The representative member.
The deadline for these claims is **31 De
by Ariful | Sep 14, 2026 | Australia Updates
TITLE: ATO Software Royalties, Contractor Super and CGT Concession Changes: What Australian Businesses Need to Know
Review software payments under final ATO royalties ruling
The ATO released Taxation Ruling TR 2026/2 on 4 September 2026. It explains when payments made under software intermediation and distribution arrangements may be treated as royalties for Australian tax purposes.
The key issue is whether a payment is made for the use of, or the right to use, copyright or other intellectual property. This can include implied rights, even where the contract does not expressly describe a copyright licence.
The ruling may affect:
- Cloud software and SaaS distribution arrangements.
- Subscription platforms and app marketplaces.
- Australian entities distributing offshore software.
- Businesses that do not own, host or develop the underlying software.
- Cross-border payments to software owners or licensors.
This means a payment may potentially attract Australian royalty withholding tax even where the Australian business only facilitates access, distribution or subscriptions. The ATO position is relevant to major multinational technology groups, including businesses operating in ecosystems associated with Apple, Google, Microsoft and Amazon.
The ruling applies to arrangements both before and after its release. You should therefore review existing agreements, payment flows and withholding processes rather than limiting your review to new contracts.
The ATO also issued draft Practical Compliance Guideline PCG 2026/D4. It proposes five colour-coded risk zones:
- White.
- Green.
- Yellow.
- Amber.
- Red.
Many SaaS and subscription distribution models may fall within the amber zone unless the business recognises a royalty position and manages the related withholding obligations appropriately.
Consultation closes on 2 October 2026. Businesses with affected arrangements should review the draft guideline and document their position before the deadline.
Read the final ATO software royalties ruling and the draft PCG 2026/D4 compliance framework.
Separate contractor labour costs before calculating super
The ATO has released draft Superannuation Guarantee Determination SGD 2026/D1. It clarifies how businesses should calculate superannuation obligations for contractors who are treated as employees under the extended definition.
The core rule is straightforward. You must identify the part of a contractor payment that relates to the individual’s labour. Superannuation applies to that labour component.
Non-labour amounts may generally be excluded where they relate to items such as:
- Materials.
- Plant or equipment hire.
- Genuine reimbursements.
- Third-party costs.
- Costs paid as the client’s agent.
- The GST component.
Invoices that clearly separate labour and non-labour costs are easier to process. If an invoice combines everything into one amount, you need a reasonable and documented methodology for calculating the labour component.
Your records should explain:
- What services the contractor provides.
- Which costs relate directly to personal labour.
- Which costs are materials, reimbursements or third-party charges.
- How you calculated the labour proportion.
- Why the methodology is reasonable for the relevant industry and contract.
This guidance is particularly important now that Payday Super is in effect. Payroll and accounts payable systems must identify qualifying contractor payments accurately and process superannuation on time.
Review contractor agreements and invoice templates now. Doing so will reduce the risk of underpayments, correction work and ATO compliance action.
See the ATO draft SGD 2026/D1 and the ATO information on working out whether you must pay super for contractors.
Prepare for the proposed Innovative Business CGT Concession
Treasury released exposure draft legislation for the Innovative Business CGT Concession on 11 September 2026.
The proposed concession is intended to support investment in eligible innovative Australian companies. It would provide a 50% capital gains tax discount where the relevant requirements are met.
The exposure draft proposes:
- A 15-year eligibility window for qualifying companies.
- An aggregate company turnover threshold of $50 million.
- A minimum holding period of three years.
- Removal of the previously proposed $10 million lifetime cap on eligible gains.
The concession remains proposed. It is not yet a final law. Eligibility will depend on the detailed legislation, the company’s structure, the nature of its innovation, the timing of the share issue and the investor’s holding period.
This could be relevant to Australian startups, technology businesses, digital companies and investors holding qualifying equity. However, you should not assume that every early-stage or high-growth company will qualify.
Treasury submissions close on 28 September 2026. Businesses and investors should review the official Treasury exposure draft consultation and monitor the final legislation before relying on the proposed concession.
Keep records ready for wider ATO visibility
The ATO’s passenger movement data-matching program will provide broader visibility over selected individuals entering and leaving Australia through the 2028–29 financial year.
The program can match passenger information with tax registration, lodgment, payment and residency records. This may affect internationally mobile directors, contractors, employees and business owners.
Keep your records consistent across:
- Travel dates.
- Residency positions.
- Payroll records.
- Australian and offshore income.
- Company management activity.
- GST, income tax and superannuation reporting.
The ATO is also continuing its push to address approximately $115 billion in unpaid tax debt. On-the-spot late interest waivers are capped at $4,500. Requests above that amount may require formal review by a specialist team.
Accurate bookkeeping and timely filing remain the best way to avoid preventable interest and debt escalation.
Use a structured global compliance process
These developments show why Australian businesses with cross-border operations, contractor workforces or investor arrangements need a structured compliance process.
A coordinated approach should cover:
- Reviewing software and distribution agreements against TR 2026/2 and PCG 2026/D4.
- Documenting contractor labour splits for superannuation purposes.
- Monitoring the Innovative Business CGT Concession as it progresses through Parliament.
- Keeping residency, payroll and reporting records aligned.
- Addressing ATO debts early to avoid interest escalation.
Given the pace of reform across royalties, superannuation, capital gains tax and data matching, seeking advice specific to your circumstances is essential. The ATO’s positions apply to existing arrangements as well as new ones, so a proactive review now can reduce the risk of unexpected withholding liabilities, superannuation shortfalls and compliance action.
by Ariful | Sep 13, 2026 | Business
TITLE: Cross-Border Ecommerce Tax and Cash-Flow Guide for Scaling Brands
Rebuild Your Landed-Cost Model Before You Scale
Cross-border growth can increase revenue, but it can also expose hidden costs that damage cash flow and margins.
The old model was simple: calculate product cost, shipping, and payment fees, then add a margin. That model is no longer sufficient. Customs entries, duties, importer responsibilities, VAT, returns, currency movements, and marketplace deductions now have a direct effect on whether expansion is profitable.
Global cross-border ecommerce is projected to reach around $7.9 trillion by the end of 2026. SMEs capture roughly 34% of international ecommerce revenue. However, compliance costs for mid-market brands have reportedly risen from around 8.1% of gross international revenue in 2023 to approximately 11.3%.
That creates a clear growth advantage for businesses that build accurate numbers before entering a market.
Your landed-cost model should show the full cost of getting one product from your warehouse to the customer.
Include:
- Product and packaging costs.
- International freight.
- Customs duties.
- Customs entry fees.
- Broker or carrier charges.
- VAT, GST, or Sales Tax cash-flow effects.
- Fulfilment and storage.
- Payment processing.
- Foreign exchange conversion.
- Returns, refunds, and disposal.
- Local compliance and filing costs.
Do not treat customs and tax as an afterthought. A small cost per order can become a major margin reduction at scale.
Build a Separate Model for the United States
The US $800 Section 321 de minimis exemption is suspended indefinitely for commercial imports in all modes other than the international postal network. The change was codified by US Customs and Border Protection in June 2026.
Entry Type 86 is no longer available for affected shipments. Importers generally need to use:
- Entry Type 11 for eligible shipments valued at $2,500 or less.
- Entry Type 01 or another formal entry process where formal entry is required.
Commercial imports now require a customs entry, 10-digit HTS classification, and payment of applicable duties and fees. The underlying statutory repeal is scheduled for 1 July 2027.
This means your US cost model should not assume that low-value parcels can move duty-free. Add a customs cost to every relevant order or shipment, then validate the amount against the product’s HTS classification, origin, value, and transport method.
The CBP ecommerce FAQs should be checked for operational requirements before you change your fulfilment process.
Recalculate the EU Low-Value Cost
From 1 July 2026, the EU’s €150 customs duty exemption for low-value consignments was abolished.
A temporary flat customs duty of €3 per item now applies to distance sales of imported goods with an intrinsic value up to €150. The temporary measure is scheduled to apply until 1 July 2028.
This is charged per item, not necessarily per parcel. A shipment containing two different products may therefore create two €3 duty charges.
IOSS remains available. The Import One-Stop Shop still allows eligible sellers to report and remit import VAT on qualifying distance sales. The €3 customs duty is separate from VAT.
Product identifiers can be declared voluntarily from 1 July 2026 and become mandatory for relevant shipments from 1 November 2026. Prepare your SKU, manufacturer, and standardised product identifier data now.
Review the European Commission’s low-value import guidance when designing your EU data and shipping process.
Decide Who Will Be the Importer of Record
The importer of record is responsible for ensuring that goods enter a country lawfully.
In the US, the importer of record typically carries responsibility for:
- Providing accurate customs information.
- Confirming the 10-digit HTS classification.
- Declaring the correct customs value and country of origin.
- Paying duties, fees, and other import charges.
- Maintaining import records.
- Ensuring the goods meet applicable US requirements.
A customs broker can submit entries, but using a broker does not automatically transfer the importer’s underlying responsibility.
Understand Amazon FBA Responsibilities
For a UK company sending stock to Amazon FBA in the US, Amazon may not automatically become the importer of record. The specific arrangement depends on the shipping terms, carrier, seller structure, and Amazon programme being used.
Before moving inventory, confirm:
- Which entity is named as importer of record.
- Which entity provides the customs bond.
- Who supplies the HTS classification and origin data.
- Who pays duties and import fees.
- How customs documents flow into your accounts.
- Whether the inventory movement creates US tax or reporting obligations.
This is a key part of amazon FBA accounting UK because the bookkeeping must reconcile inventory leaving the UK, entering the US, moving into FBA, and ultimately being sold to customers.
Also separate customs compliance from US Sales Tax. Import clearance does not automatically settle state Sales Tax obligations. Your business may still need to monitor state registrations, marketplace reporting, and filing requirements.
Do Not Miss Form 5472 Reporting
Foreign-owned US corporations and certain foreign-owned US disregarded entities may have information reporting obligations, including Form 5472, where reportable transactions occur with related parties.
Examples may include:
- Funding from a UK parent.
- Payments between related entities.
- Intercompany services.
- Inventory transfers.
- Loans or reimbursements.
The IRS instructions state that a failure to file Form 5472, filing substantially incomplete information, or failing to maintain required records can trigger a $25,000 penalty. Additional penalties can apply if the failure continues after IRS notification.
These form 5472 penalties can become severe. Confirm the current position with the IRS Form 5472 instructions before filing.
Build a Financial Control System for Expansion
Expansion should be funded by a clear operating plan, not by optimistic sales forecasts.
Ring-Fence Tax and Customs Cash
Create separate cash reserves for:
- Import duties.
- US Sales Tax remittances.
- EU VAT.
- Payroll taxes where applicable.
- Corporation or income tax.
- Returns and refunds.
- Customs corrections or unexpected carrier charges.
Treat collected indirect tax as restricted cash. This prevents you from spending money that belongs to a tax authority.
Maintain a Rolling 13-Week Cash-Flow Forecast
Update your forecast every week. Include:
- Marketplace settlement dates.
- Supplier payment dates.
- Inventory purchases.
- Customs and freight payments.
- VAT and Sales Tax filing dates.
- Payroll.
- Advertising spend.
- Refunds and chargebacks.
- Currency movements.
Add a downside case where sales are lower, returns are higher, and customs costs increase. If the business cannot absorb that scenario, fix the cash position before scaling.
Track True Contribution Margin by Market
Revenue alone will not tell you whether a market is working. Measure contribution margin after:
- Landed cost.
- Marketplace commission.
- Fulfilment fees.
- Advertising.
- VAT or Sales Tax treatment.
- Returns.
- Currency conversion.
- Local compliance costs.
A market can look successful at the top line and still destroy cash. Review margin by country, channel, and SKU so decisions reflect the real economics.
Manage Currency and Marketplace Deductions
Currency movements affect pricing, margins, and cash timing. Marketplace deductions affect the amount that actually reaches your bank account.
Separate Marketplace Fees From Tax Withholdings
Marketplaces may deduct referral fees, fulfilment fees, storage fees, advertising costs, and tax withholdings. These are not all the same. Some reduce revenue; others represent tax collected or withheld on your behalf.
Your bookkeeping should:
- Match marketplace settlements to sales.
- Separate fees from tax withholdings.
- Reconcile payouts to bank deposits.
- Record foreign exchange gains and losses.
- Track refunds and reversals.
Poor reconciliation creates inaccurate margin reporting and increases the risk of tax errors.
Plan for Currency Risk
If you buy in one currency and sell in another, exchange-rate movements change your margin. Consider:
- Holding buffer cash in the currencies you trade in.
- Reviewing pricing when rates move materially.
- Using forward contracts or multi-currency accounts where appropriate.
- Recording exchange differences correctly in your accounts.
Ignoring currency risk can turn a profitable market into a loss-making one without any change in sales volume.
Frequently Asked Questions
Does the US $800 de minimis exemption still apply?
No. The $800 Section 321 de minimis exemption is suspended indefinitely for commercial imports in all modes other than the international postal network. The underlying statutory repeal is scheduled for 1 July 2027.
What replaced Entry Type 86?
Entry Type 86 is no longer available for affected shipments. Importers generally need to use Entry Type 11 for eligible shipments valued at $2,500 or less, or Entry Type 01 or another formal entry process where formal entry is required.
How much is the EU flat customs duty on low-value goods?
A temporary flat customs duty of €3 per item applies to distance sales of imported goods with an intrinsic value up to €150. It is scheduled to apply until 1 July 2028.
Is the €3 EU duty charged per parcel or per item?
It is charged per item, not necessarily per parcel. A shipment containing two different products may therefore create two €3 duty charges.
Can Amazon be the importer of record for FBA shipments?
Not automatically. Whether Amazon becomes the importer of record depends on the shipping terms, carrier, seller structure, and Amazon programme. Confirm this before moving inventory.
What is the penalty for not filing Form 5472?
The IRS states that failure to file Form 5472, filing substantially incomplete information, or failing to maintain required records can trigger a $25,000 penalty. Additional penalties can apply if the failure continues after IRS notification.
What should a rolling cash-flow forecast include?
A rolling 13-week forecast should include marketplace settlement dates, supplier payments, inventory purchases, customs and freight payments, VAT and Sales Tax filing dates, payroll, advertising spend, refunds and chargebacks, and currency movements.
Plan Before You Scale
Cross-border growth rewards businesses that understand their numbers. Rebuild your landed-cost model, confirm who is the importer of record, ring-fence tax and customs cash, and track true contribution margin by market.
If customs duties, VAT, Sales Tax, Form 5472 reporting, or marketplace reconciliation are creating uncertainty, professional advice can help you build a structure that supports expansion instead of undermining it.
by Ariful | Sep 13, 2026 | US Updates
The US Treasury has welcomed the OECD’s revised **GloBE Information Return (GIR)**, released on 11 September 2026.
The revised return gives US-headquartered multinational groups the mechanism to elect the **Side-by-Side safe harbor**. This is designed to prevent those groups from facing overlapping foreign Pillar Two taxes alongside US global minimum tax rules.
For international sellers with operations in the UK, EU, Canada, Australia, or the USA, this update changes how global minimum tax reporting should be organised.
## What changed on 11 September 2026?
The revised GIR implements an important part of the Side-by-Side package agreed by more than 145 countries in January 2026.
For eligible US-headquartered groups, the safe harbor is intended to ensure that they remain subject to US global minimum taxes rather than overlapping foreign Pillar Two cross-border taxes.
The revised GIR now:
– Adds a field for a US-headquartered company to elect the Side-by-Side safe harbor.
– Exempts qualifying electing companies from Pillar Two’s **Income Inclusion Rule (IIR)** and **Undertaxed Profits Rule (UTPR)**.
– Provides specific exemptions from certain GIR reporting requirements after the election.
– Standardises reporting for local minimum taxes.
– Limits information sharing for local minimum-tax purposes to the relevant jurisdiction.
– Allows foreign-headquartered companies operating in the USA to protect qualifying substance-based tax incentives, including the US Research and Development tax credit, from Pillar Two top-up taxes.
The US Treasury described the change as a way to reduce duplicated compliance work while preserving US tax sovereignty.
You can read the [official US Treasury announcement](https://home.treasury.gov/news/press-releases/sb0628) and the [OECD GloBE Information Return publication](https://www.oecd.org/en/publications/tax-challenges-arising-from-the-digitalisation-of-the-economy-globe-information-return-september-2026_0f9da895-en.html).
## How the Side-by-Side safe harbor affects US groups
The main benefit is the potential removal of overlapping IIR and UTPR exposure for an eligible US-headquartered group.
Previously, a US parent with subsidiaries or branches in London, the EU, Toronto, Sydney, or other locations could face complex Pillar Two calculations across several jurisdictions. The group might also need to provide detailed information about operations, tax rates, income, and covered taxes in each country.
The revised GIR is intended to streamline this process.
However, the safe harbor is not simply an automatic exemption. Your group must:
1. Confirm that the ultimate parent company is US-headquartered.
2. Check whether the relevant US regime qualifies under the Side-by-Side framework.
3. Complete the revised GIR correctly.
4. Make the election through the required reporting mechanism.
5. Continue reviewing local minimum-tax and other domestic filing obligations.
6. Retain records supporting the group structure, financial data, and election.
**Do not stop your compliance process because the safe harbor is available.** The election itself creates a reporting requirement, and local rules may still require information or tax filings.
## Example: A UK ecommerce group with a US parent
Imagine a US-headquartered ecommerce group with:
– A parent company in Delaware.
– A fulfilment company in the UK.
– Sales and VAT registrations in Germany and France.
– A Canadian subsidiary.
– Australian marketplace activity.
The group may have previously needed to assess how Pillar Two rules in multiple territories could interact with US global minimum tax rules.
Under the revised GIR, the US parent may be able to elect the Side-by-Side safe harbor. If the group qualifies and makes the election correctly, the IIR and UTPR should not apply to the group under the safe harbor framework.
The group would still need to maintain reliable records across the USA, UK, EU, Canada, and Australia. It may also need to address:
– UK corporation tax and statutory accounts.
– EU VAT registrations and periodic VAT returns.
– Canadian corporate tax and sales tax obligations.
– Australian GST and company reporting.
– Local minimum-tax requirements where applicable.
– Intercompany transactions and cross-border payment records.
The practical benefit is not the elimination of all international compliance. It is a more structured route for separating US global minimum tax treatment from local VAT, GST, sales tax, and other filing obligations.
## Example: Foreign founders operating through a US LLC
A second example involves founders based in London, Toronto, Melbourne, or another country who operate through a US LLC.
A US LLC does not automatically mean that the business is an in-scope multinational group for Pillar Two purposes. Many smaller businesses will not meet the relevant group size or scope conditions.
The first step is therefore to establish whether the business is within the GloBE rules at all.
If it is not, the revised GIR may not apply. The business may instead need to focus on:
– US federal income tax filing.
– Estimated tax payments.
– State sales tax registration and returns.
– Information reporting.
– UK, Canadian, Australian, or EU obligations linked to the founders and trading activity.
– VAT, GST, or sales tax on cross-border customer sales.
If the business is part of a larger multinational group, however, the group should review whether the revised GIR and Side-by-Side election apply at parent-company level.
**Classify the entity before assuming the relief applies.** This will prevent you from overlooking ordinary US filing and payment obligations.
## Foreign-headquartered companies may benefit from R&D credit protection
The revised GIR also addresses companies headquartered outside the United States.
A foreign-headquartered group operating in the USA may have US research and development activity and claim the US R&D tax credit. The revised rules allow taxpayers to apply protections for qualifying substance-based tax incentives that formed part of the Side-by-Side package.
This could be relevant to:
– SaaS businesses with US engineering teams.
– Digital agencies developing proprietary software.
– Ecommerce groups operating US product or technology centres.
– Canadian or UK companies with US research functions.
– Australian businesses expanding their technology operations into Washington DC or other US locations.
You should not assume that every R&D credit is automatically protected. Review the group’s structure, activities, credit calculations, and applicable implementation rules before completing the GIR.
## Keep your underlying data ready
The revised GIR may reduce duplicative reporting. It does not remove the need for accurate accounting data.
Prepare the following information:
– Group legal structure and ownership percentages.
– Ultimate parent company details.
– Entity-by-entity revenue and profit figures.
– Jurisdictional tax paid and tax accrued.
– Payroll and tangible-asset information.
– Details of US R&D activity and credits.
– Intercompany transactions.
– VAT, GST, and sales tax registrations.
– Local minimum-tax filings and payment records.
– Pr
