Family-owned groups still ask whether OECD rules were “only for listed multinationals.” They were not. OECD pillar two family groups that meet the revenue test are in the GloBE perimeter even when every share sits with cousins. The Global Anti-Base Erosion Model Rules impose a 15% jurisdictional effective-tax-rate floor, with top-up tax collected through a Qualified Domestic Minimum Top-up Tax, an Income Inclusion Rule, and, as a backstop, an Undertaxed Profits Rule. Private ownership is not an excluded-entity category.
This article is general information for families and family offices. It is not a GloBE computation, a mandate, or personalised advice. Scope, safe harbours, and top-up tax depend on consolidated accounts, on the jurisdictions that have implemented, and on counsel who can read the OECD texts and the domestic statutes together.
OECD pillar two family groups can be in scope without a listing
The OECD Inclusive Framework published the GloBE Model Rules in December 2021. The official desk remains the OECD page on the Global Anti-Base Erosion Model Rules (Pillar Two). The OECD FAQs on the GloBE Rules state the architecture in short form: a 15% minimum effective rate, tested jurisdiction by jurisdiction, on in-scope MNE groups. The European Union adopted Council Directive (EU) 2022/2523 as a common implementation. By 2026 many Member States, including France, are applying IIR and QDMTT, with UTPR in force on the directive’s timetable. This article describes that architecture. It does not invent a family-office exemption that the Model Rules forgot to write.
Pillar Two is a corporate-group regime. It is not IFI, not a personal wealth tax, and not a substitute for ATAD interest limitation. Holding charts that already struggle with article 212 bis, as in ATAD interest limitation 2026, can also be GloBE constituent entities if the group clears the revenue gate. The two files share a chart. They do not share a formula.
The 15% GloBE test is a jurisdictional ETR
GloBE does not ask whether the group’s blended worldwide rate is 15%. It asks, for each jurisdiction, whether covered taxes divided by GloBE income meet 15%. If the jurisdictional ETR is below 15%, top-up tax is computed on excess profits after the Substance-based Income Exclusion (a carve-out based on payroll and tangible assets). A family group that is highly taxed in France and lightly taxed in a holding or IP company abroad can owe top-up even if the French company’s headline rate is 25%. The low-tax jurisdiction is the problem child. The high-tax jurisdiction is not a sponge that absorbs the gap by averaging.
GloBE income starts from financial-accounting net income of constituent entities, with specified adjustments. Covered taxes are the taxes accrued on that income, with further adjustments. Deferred tax, timing differences, and hybrid instruments are why a management EBITDA pack is not a GloBE pack. Families who paste a country-by-country reporting ETR into a board memo have a related indicator, not the GloBE computation. CbCR’s €750 million gate is historically the cousin of the GloBE gate. The computations after the gate diverge.
The €750 million revenue test
Article 1.1 of the Model Rules applies GloBE to constituent entities of an MNE group that has annual revenue of €750 million or more in the consolidated financial statements of the Ultimate Parent Entity in at least two of the four fiscal years immediately preceding the tested year. A year that is not twelve months is scaled. Article 6.1 modifies the threshold in specified cases (mergers, demergers, the first year after crossing). The OECD FAQs repeat the same test: consolidated revenues of €750 million in at least two of the last four years.
Three family-office mistakes follow. First, treating the test as “€750 million of taxable profit.” It is revenue in the consolidated accounts, under the accounting standard those accounts use. Second, treating a single bumper year as in-scope forever, or a single thin year as a permanent exit. Two of four is a pattern, not a peak. Third, ignoring that a privately held group that never produced IFRS consolidated accounts may still have to build a consolidating view for GloBE, because the UPE concept does not require a listing. If the family reports a combined revenue above the gate in two of four years, the group is in the conversation.
Excluded entities are not a family-office free pass
Government entities, international organisations, non-profits, pension funds, and certain investment funds that are UPEs are excluded entities. The FAQs are explicit: the exclusion does not automatically extend to all entities those excluded persons own. A family is not an excluded entity. A family holding company is not a government. A family office vehicle that is an investment fund under the GloBE definitions may be excluded as UPE in narrow cases; most operating groups owned by a family are not investment funds. Assuming “we are private, therefore excluded” is the error this article exists to correct.
QDMTT, IIR, and UTPR, conceptually
Three collection rules stack. A Qualified Domestic Minimum Top-up Tax lets the low-tax jurisdiction itself charge the top-up on its own constituent entities. Many countries introduced a QDMTT so that the tax stays at home. An Income Inclusion Rule lets a parent entity (typically the UPE, or an intermediate parent) pick up remaining top-up on low-tax subsidiaries. An Undertaxed Profits Rule is the backstop: if top-up would otherwise go uncollected, other implementing jurisdictions allocate it among themselves, usually by denying deductions or by an equivalent adjustment, using a substance-based allocation key of employees and tangible assets.
Conceptually, the order is QDMTT first, IIR second, UTPR last. A family group whose only low-tax entity sits in a country with a QDMTT may pay the top-up there and have little IIR or UTPR left. A family group whose low-tax entity sits in a country with no GloBE implementation may see IIR at the French (or other parent) level, or UTPR in countries where the group has staff and factories. UTPR is why a manufacturing subsidiary in an implementing State can become the collection point for undertaxed profits elsewhere. It is not a personal assessment on the cousins. It is a corporate adjustment in the entities that have substance under the allocation key.
Safe harbours, including transitional CbCR safe harbours and a QDMTT safe harbour in later administrative guidance, can switch off full computations for a jurisdiction in a year. They are mechanical tests. They are not a political promise that family groups will be left alone. The OECD administrative guidance issued through 2023 and after remains on the same OECD pillar two page. Materials published by August 2026 are in scope for this note. This article does not cite later prints. A group that qualifies for a transitional safe harbour still has to evidence the CbCR numbers. A safe harbour is a file, not a rumour that “private groups are out.”
What a family office should map
A useful map is a group perimeter, not a family tree of first names. Identify the UPE. List every entity that would be a constituent entity. Obtain or build consolidated revenue for the last four years against the €750 million test. List jurisdictions, covered taxes, and a first-pass ETR indication (CbCR can be a screen, not an answer). Flag entities in low-tax or preferential regimes, IP companies, and pure holdings. Flag countries with a QDMTT, with IIR, and with UTPR. Flag investment-fund arguments only where the GloBE definition might actually fit. Flag joint ventures and minority-owned entities under the Model Rules’ ownership thresholds.
Then put the personal wealth files beside the group file, not inside it. IFI, as in the IFI 2026 taxable-wealth inventory, looks through companies for French real estate. GloBE looks at the company’s own ETR. A brick inside a French SCI can be IFI for the family and irrelevant to GloBE if the group is below €750 million. A trading group above €750 million can be GloBE in scope and still have an IFI problem on the side. Implementation calendars differ by country: IIR and QDMTT generally from 2024 in the EU, UTPR from 2025 on the directive’s timetable, with local variations. A family group that crossed €750 million in 2023 and 2024 is not waiting for a 2027 “maybe.” It is already in a compliance year. Vellum Finance does not file GloBE information returns. The Vellum Finance services model is fee-only coordination so that the family’s counsel, auditors, and tax administrators are working from one perimeter. The 2026 output is a yes/no on the revenue gate, a list of jurisdictions, and the collection rule that would apply if an ETR were below 15%.
Conclusion
OECD pillar two in 2026 is a 15% jurisdictional GloBE floor for MNE groups with €750 million of consolidated revenue in two of the four preceding years. QDMTT, IIR, and UTPR are the collection stack. Privately held, family-owned groups can be in scope. Excluded-entity status is written for governments, charities, pension funds, and certain funds, not for cousins. Read the OECD pillar two pages and the EU directive. Count consolidated revenue. Do not wait for a listing, and do not invent a family exemption.
Discretion. Stability. Prosperity.
Team Vellum
A team of passionate professionals who combine their expertise to bring knowledge through Vellum Finance & Patrimoine blog articles. Each member writes about their own field of expertise, cross referencing with our colleagues own fields to ensure the highest quality of information possible in all our content.
