EU Taxonomy Reporting in 2026: What Actually Changed (And What You Need to Do)

Two significant changes to EU Taxonomy reporting landed simultaneously at the start of 2026 - and if your finance or sustainability team is preparing an Article 8 disclosure right now, both of them affect your workload directly. This guide cuts through the regulatory language and tells you what changed, who it applies to, and what to do before your next report is filed.

This article reflects the rules as published in the Official Journal as of June 2026. Final implementation details may still be refined; always verify against the latest Commission text before filing.

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What is EU Taxonomy Reporting (Article 8)?

EU Taxonomy reporting - formally Article 8 of Regulation (EU) 2020/852 - requires in-scope companies to disclose what share of their business is environmentally sustainable. Article 8 requires companies to disclose, in their non-financial statement, detailed information on how and to what extent their activities are associated with environmentally sustainable economic activities, and the proportion of turnover, capital expenditure (CapEx), and operating expenditure (OpEx) related to such activities.

The framework works in two steps:

• Eligibility: Does the activity even appear in the Taxonomy's list of covered sectors?
• Alignment: Does it meet the Technical Screening Criteria (TSC), pass the "Do No Significant Harm" (DNSH) tests for all six environmental objectives, and comply with minimum social safeguards?

Companies report three KPIs - turnover, CapEx, and OpEx - showing what percentage is Taxonomy-eligible and, within that, what percentage is Taxonomy-aligned. Those numbers feed directly into investor ESG assessments, green bond frameworks, and bank lending decisions.

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Who Must Report Now? The Omnibus Scope Cut

The short answer: mandatory Article 8 reporting now applies only to EU entities with more than 1,000 employees and net turnover above EUR 450 million.

The Omnibus Directive narrows the scope of entities required to report in accordance with ESRS and the EU Taxonomy to EU entities with over 1,000 employees and a net turnover exceeding EUR 450 million. The Omnibus Directive was published in the Official Journal of the European Union on 26 February 2026, following its official adoption by the Council of the European Union on 24 February 2026.

This is a significant increase compared to the previous thresholds, which were set at EUR 50 million in net turnover, EUR 25 million on the balance sheet, and 250 employees. It has been estimated that the Omnibus will exclude 80% of companies from the scope of CSRD - and because Article 8 Taxonomy scope is tied directly to CSRD scope, that 80% figure applies here too.

The opt-in regime for smaller companies

If your company falls below the new thresholds, mandatory Taxonomy reporting no longer applies. For those below the thresholds, an "opt-in" regime is available, allowing voluntary application. Under the opt-in regime, Taxonomy reporting is required only if the company chooses to claim that its activities qualify, fully or partially, as environmentally sustainable under the Taxonomy Regulation. If no such claim is made, Taxonomy reporting is not required.

Not sure whether you're in or out of scope? Use the CSRD scope checker to run the numbers against the new thresholds.

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The New 10% Materiality Threshold - Explained

This is the most practically significant change for companies that are in scope.

On 28 January 2026, the Commission Delegated Act, which simplifies the application of the EU Taxonomy Regulation, entered into force, having been published in the Official Journal of the EU on 8 January 2026. Its headline measure: a formal materiality threshold that lets you skip detailed eligibility and alignment assessment for small activities.

For non-financial undertakings, economic activities do not have to be assessed for Taxonomy alignment where they cumulatively represent less than 10% of the entity's total turnover, capital expenditure, or operational expenditure.

Materiality should be assessed for each key performance indicator independently. For non-financial companies, an economic activity will be non-material if, in aggregate, it accounts for less than 10% of turnover, CapEx, or OpEx.

That last point matters: the 10% test is run three times - once for each KPI - not once across the board. An activity might be material for turnover but immaterial for CapEx, or vice versa.

Worked example

Imagine a manufacturing company with the following profile:

Reading the result:

KPI	Total	Activity B share	Below 10%?	Assessment required?
Turnover	EUR 348m	EUR 28m = 8.0%	✅ Yes	No - excluded
CapEx	EUR 48m	EUR 3m = 6.3%	✅ Yes	No - excluded
OpEx	EUR 34m	EUR 6m = 17.6%	❌ No	Yes - must assess

Activity B clears the materiality threshold for turnover and CapEx - so the company can skip the full eligibility/alignment assessment for those two KPIs. But because Activity B's OpEx share exceeds 10%, it must still be assessed for the OpEx KPI.

Non-financial companies are required to disclose, within their reporting templates, the proportion of turnover, CapEx, or OpEx considered non-material and therefore not assessed. Exclusion is not invisible - you still have to state what you left out and why.

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Lighter Templates: From 78 to 28 Datapoints

Even for activities that do require full assessment, the reporting workload has shrunk substantially.

For non-financial undertakings, the number of datapoints per activity is reduced from 78 to 28 - a reduction of approximately 64%. For non-financial undertakings, the number of datapoints per activity is reduced from 78 to 28, representing a reduction of around 64%.

For financial undertakings, in particular banks and credit institutions, the number of datapoints is reduced by up to 89%. In addition, a new summary reporting template is introduced, focusing on the information relevant for financial undertakings to calculate their KPIs. Separate templates for fossil gas and nuclear energy are removed or integrated into general templates.

In practice, the 50 datapoints removed from non-financial templates were largely contextual, optional, or duplicative fields that added audit complexity without improving the signal for investors. The remaining 28 focus on the information that actually drives the KPI calculation: activity revenue/spend, alignment status, and DNSH outcomes.

Separate templates for fossil gas and nuclear activities have been removed; reporting on these activities is now integrated into the general templates when they are material.

What this means for your team:

• Fewer cells to populate in the disclosure spreadsheet or software
• Shorter audit trail to maintain for each activity
• Less time spent on fields that auditors rarely interrogated anyway
• Simpler consolidation across business units

The core logic - eligibility -> alignment -> DNSH -> minimum safeguards - has not changed. The simplification is in the presentation, not the underlying classification criteria.

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Timing and Retroactive Application

Commission Delegated Regulation (EU) 2026/73 was published in the Official Journal on 8 January 2026 and entered into force on 28 January 2026, with retroactive application from 1 January 2026.

The Delegated Act entered into force on 28 January 2026 and starts applying retrospectively from 1 January 2026, covering the 2025 financial year for companies already in scope of the EU Taxonomy regime.

That retroactivity creates a practical choice for your current reporting cycle:

The new rules will be mandatory for the 2026 financial year. For reports covering the 2025 financial year, companies may choose between the old and the new rules.

The undertaking must include a statement in its sustainability report that specifies which set of reporting rules were applied when reporting on the 2025 financial year.

Timeline at a glance:

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What to Do Before Your Next Report: A Practical Checklist

Use this as a working checklist for your finance and sustainability teams. Check the EU Taxonomy deadlines page for the exact filing dates that apply to your entity.

Step 1 - Confirm whether you're still in scope Run the new dual test: more than 1,000 employees and net turnover above EUR 450 million. Both conditions must be met. If you're below either threshold, mandatory Article 8 reporting no longer applies - but document that conclusion.

Step 2 - Decide which framework to use for FY2025 If you're filing a FY2025 report now, choose between the old templates and the new simplified ones. The new framework is almost certainly less work. Whichever you pick, add the required statement to your sustainability report.

Step 3 - Run the 10% materiality test for each KPI List all economic activities in your business. For each KPI (turnover, CapEx, OpEx), calculate each activity's share of the total. Activities that cumulatively fall below 10% for a given KPI can be excluded from detailed assessment for that KPI. Document the calculation - auditors will want to see it.

Step 4 - Update your disclosure templates Switch to the new 28-datapoint templates for non-financial undertakings. If you use reporting software, check whether your vendor has already updated their templates to reflect Delegated Regulation (EU) 2026/73.

Step 5 - Disclose excluded activities For any activity excluded under the materiality threshold, include the required disclosure of the proportion of turnover, CapEx, or OpEx that was not assessed. This is mandatory - exclusion is not the same as omission.

Step 6 - Verify DNSH and minimum safeguards for aligned activities The simplification does not change the underlying Technical Screening Criteria or DNSH requirements. Activities that clear the materiality threshold and are being assessed for alignment still need the full DNSH evidence trail.

Step 7 - Check the latest Commission text The Omnibus package is still being transposed into national law, and the Commission has published FAQ guidance on the materiality threshold. Verify any edge cases - particularly around joint ventures, OpEx definitions, and multi-activity groups - against the current official text before filing.

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The Bigger Picture

The 2026 changes are a recalibration, not a retreat. The Delegated Act represents a targeted easing of short-term compliance pressure rather than a shift away from the EU Taxonomy itself. While reporting requirements are temporarily simplified, the underlying classification system and its relevance for capital allocation, transition planning, and sustainable finance remain intact.

For companies that remain in scope, the practical burden is meaningfully lower - fewer datapoints, a formal escape valve for immaterial activities, and cleaner templates. The investment in understanding your Taxonomy-eligible and aligned activities is still worth making: those KPIs feed investor questionnaires, green finance instruments, and supply-chain due diligence requests that exist independently of the regulatory mandate.

For companies that have just dropped out of mandatory scope, the opt-in regime means you can still make voluntary Taxonomy disclosures if your investors or customers expect them - without being bound by the full mandatory framework.

Stay on top of further changes - the ESRS standards are also being revised, and transposition of the Omnibus Directive into national law is ongoing across Member States. Subscribe to The CSRD Brief for plain-English alerts when the rules move again.