Understanding DIP for CbCR and Pillar 2 Reporting - and why German HQs Must Reassess Their Filing Strategy Now

Many German‑headquartered groups are currently preparing for their first Pillar 2 filings, while at the same time gearing up for Public Country‑by‑Country Reporting (CbCR). This is exposing a fundamental issue: existing tax reporting processes are often not designed for structured, multi-use data across different reporting frameworks.

At the same time, tax authorities are moving towards standardised, machine‑readable reporting. In Germany, this shift is reflected in the introduction of the Digitaler Posteingang (DIP), a mass data interface already used for reporting procedures such as CbCR and Pillar 2, and clearly becoming the standard mechanism for structured tax data submission. For German‑headquartered groups, this goes beyond a technical change. It fundamentally affects how tax data is prepared, validated, and reported and raises expectations around data quality, internal controls, and consistency across reporting streams.

From CbCR to Pillar 2: What is changing in tax reporting

While Public CbCR is a disclosure requirement handled via the Unternehmensregister (Bundesanzeiger), tax reporting obligations such as OECD CbCR and Pillar 2 are submitted directly to tax authorities.

OECD CbCR has already introduced structured reporting. With Pillar 2, both the volume and complexity of required data increase significantly, while dependencies between financial and tax data become more critical.

At the same time, tax authorities are moving away from document-based reporting towards schema-based, machine‑readable submissions. In Germany, this is increasingly supported by structured interfaces such as DIP, enabling automated data transmission and validation.

This shift has several implications:

• Data must comply with strict schema requirements

• Automated validation replaces manual checks

• Submissions become more consistent and comparable

• Data quality issues are more easily identified

Timeline and scope

The implementation of Public CbCR and Pillar 2 reporting follows distinct timelines, but both are now entering critical phases for multinational groups.

• Public CbCR applies to financial years starting 22 June 2024, with first publications expected in 2026

• Pillar 2 reporting requirements are already being introduced across jurisdictions, with first filings generally expected in 2026, depending on fiscal year and local implementation

At the same time, Germany is advancing the use of structured submission mechanisms such as DIP, which are expected to replace legacy reporting channels over time.

The requirements are especially relevant for:

• German‑headquartered multinational groups

• Groups with international subsidiaries or branches

• Groups exceeding EUR 750 million in consolidated revenue

As a result, many organisations are facing overlapping implementation timelines, requiring them to prepare for both:

• public disclosure (Public CbCR)

• and structured tax authority reporting (CbCR and Pillar 2)

This overlap significantly increases complexity, as organisations must manage different formats, systems, and stakeholders simultaneously.

How DIP works in practice

To understand the impact of DIP, it is important to look beyond the idea of a “submission platform.” DIP is not a traditional upload portal, but a mass data interface that enables automated system-to-system transmission of tax data.

In practice, this means:

• Data is generated in internal systems and transmitted via system-to-system communication

• Submissions must follow predefined XML schemas, ensuring a consistent data structure

• Each filing is subject to automated validation rules before being accepted

• Invalid submissions are rejected, requiring correction at source

What organisations actually need to implement

This technical shift translates into concrete operational requirements.

To comply with structured reporting frameworks such as DIP, organisations need to establish a fully integrated reporting process, spanning tax, finance, and IT.

In practice, this typically involves:

• Setting up secure access and authentication mechanisms, including certificates and technical user roles

• Integrating internal systems with the submission interface, enabling automated data transmission

• Generating report data in line with predefined XML schemas, ensuring compatibility with validation rules

• Managing a multi-step submission lifecycle, including submission tracking and result handling

• Implementing testing and validation workflows before productive submissions

• Monitoring submission outcomes and handling rejections, requiring fast feedback loops

In other words, organisations are no longer just preparing reports. They are operating acontinuous, technically integrated reporting process.

In addition, submissions follow a multi-step process, including:

• Authentication using certificates and access tokens

• Registration of the data transfer

• Upload and confirmation of submission

• Retrieval and processing of validation results

This fundamentally changes the nature of tax reporting: instead of submitting documents, organisations are required to deliver structured, validated data that can be processed directly by tax authorities.

Practical challenges for tax functions

While many organisations already have CbCR processes in place, these are often not designed for highly structured, schema-based reporting.

Typical challenges include:

• Limited support for XML-based reporting formats

• Lack of automated validation against official schemas

• Insufficient auditability and governance structures

• Continued reliance on manual processes (e.g. Excel)

Why acting early matters

The combination of:

• increasing reporting complexity (Pillar 2)

• structured submission formats (XML, DIP)

• and external transparency requirements (Public CbCR)

creates significant pressure on tax functions.

Many existing tools were not designed for this level of integration and structure.

Organisations that delay risk increased manual effort, higher error rates, and reduced control under tight deadlines.

• Early action allows for a more structured approach, including:

• Assessing current systems and identifying gaps

• Aligning tax, finance, and IT stakeholders

• Establishing clear data ownership and governance

• Implementing scalable, future-proof reporting processes

Conclusion

The introduction of DIP in Germany reflects a broader trend: tax reporting is becoming fully digital, standardised, and data-driven.

For German‑headquartered multinational groups, this is not only about meeting compliance requirements, it is about ensuring that underlying data structures can support multiple reporting obligations simultaneously.

Organisations that address this early will be better positioned to manage complexity, ensure consistency across reporting streams and meet increasing expectations from both tax authorities and the public.

At the same time, increasing transparency, especially through Public CbCR , makes inconsistencies more visible. Differences between financial statements, tax reporting, and published disclosures are easier to identify and potentially more impactful from a reputational perspective.

How technology can support Public CbCR requirements

Given the increased data complexity, new publication obligations, and heightened consistency and governance requirements, many companies rely on technology solutions to manage both OECD CbCR and Public CbCR within a single, controlled process.

Aunetic has supported multinational groups with OECD CbCR compliance since its introduction in 2017. Building on this experience, Aunetic is well positioned to also support organisations in meeting the specific requirements of EU Public CbCR.

The updated Aunetic CbCR solution is designed to support both OECD CbCR and EU Public CbCR within a unified workflow. This allows companies to manage data collection, jurisdictional grouping, validation, narrative consistency, and publication requirements in a coordinated manner, reducing the risk of duplication and inconsistency across reporting obligations.

Organisations seeking to better understand how technology can support their Public CbCR preparation are welcome to contact us for further discussion on available solutions and implementation approaches.

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