Status of ATO implementation
The primary legislation has now received royal assent. As part of the implementation of the measure, we have started to design the domestic returns and the development of the systems required to administer the measure in advance of the first lodgments, due by 30 June 2026.
We conducted early public consultation following the Budget announcement which focused on providing:
- preliminary education and awareness, and
- seeking feedback on impacts in association with the new measure.
We have commenced the next phase of consultation through a special purpose working group to seek feedback on:
- the data points in the domestic return, and
- ways in which we can support implementation, including about communications, public advice and guidance and one-to-one engagement channels.
Consultations with digital service providers (DSP) are continuing and we are currently considering future ATO-led consultations.
Key consultation feedback and findings
The overarching theme from consultations so far includes the:
- varying degrees of readiness for when the rules start
- significant compliance challenges the Global Anti-Base Erosion Model Rules (GloBE Rules) pose
- potential technical difficulties in capturing the data points the GloBE Information Return (GIR) requires.
Capturing data points for the GIR
The feedback received so far indicates that for many MNE groups:
- the data points needed for the GIR are extensive and may require system changes or manual interventions
- given the system updates needed, one key challenge for businesses is the amount of time and resources required to set up their systems to meet their obligations.
Australian specific administration and interpretation issues
Stakeholders raised a variety of topics about our administration and interpretation of the GloBE Rules, when enacted, including:
- potential application of administrative penalties
- safe harbours, with several consultees indicated there will likely be significant reliance on safe harbours, developed by the OECD/G20 Inclusive Framework on base erosion and profit shifting
- interpretation questions relating to potential Australian income tax regime interactions.
In some instances, there was a misconception we will be able to provide further concessions and simplifications beyond the OECD/G20’s GloBE Rules to reduce compliance costs. It was communicated to consultees that, to ensure qualified status, we are unable to provide administrative concessions or simplifications that are inconsistent with those provided for in the OECD/G20's GloBE Rules, Commentary and Administrative Guidance.
Support from advisers
Several advisers:
- have built internal capability for this new measure
- are advising clients in advance of
- the start date of impact assessments
- understanding data needs for the GIR.
Even though there are certain third-party tools on the market to assist with core and safe harbour calculations, select large advisory firms are developing their own in-house modelling tools to gather data points and establish a rules database.
Support and assistance to comply with the new rules
We will likely need to assist in-scope MNEs with meeting future obligations, including:
- guidance on our client engagement approach and Australian specific administration and interpretation issues
- application and administration of any associated penalties
- a dedicated contact to assist with queries.
Key messages
The key messages from the Pillar Two Global and Domestic Minimum Tax Working Group sessions provides further details for the items discussed.
More information
For more information, see:
- Pillar Two Global and Domestic Minimum Tax Working Group
- Australia's adoption of the Implementation of a global minimum tax and a domestic minimum tax – working groupExternal Link
- Global agreement on corporate taxation: addressing the tax challenges arising from the digitalisation of the economyExternal Link