Australia’s first GloBE tax returns due 30 June 2026.
The Australian Parliament passed laws in December 2024 to enact Australia’s version of the OECD’s Pillar 2 Global anti-Base Erosion model rules (GloBE rules). Applying to Multinational Enterprise (MNE) groups with a global turnover of more than 750 million Euros, the GloBE rules provide for a minimum effective corporate tax rate of 15% in all countries that a multinational group operates.
Failure to apply tax of at least that rate in a particular country results in top up tax in the country of the MNE parent company, or failing that, a backstop measure allows other participating countries, including Australia to apply a top up tax.
Please refer to our website Global and Domestic Minimum Tax (OECD Pillar 2 GloBE Rules) for a more detailed overview of the rules.
Enforcement of these rules now requires additional reporting in all countries, comprising a Globe Information Return and Domestic Minimum tax returns.
These rules apply to financial years commencing on or after 1 January 2024 with the first tax returns (for year ended 31 December 2024) falling due on 30 June 2026.
The Australian Taxation Office (ATO) has only recently released the Combined global and domestic minimum tax return, just 3 months out from the 30 June lodgement deadline.
The affected Australian subsidiaries of MNE companies with a 31 December year end already have deadlines for fringe benefits tax return, income tax return and General Purpose Financial Statement lodgements all due within a few weeks of each other and now with a new deadline looming at a similar time, companies and their advisors are rightly concerned with the delayed release of the returns.
In Australia, late lodgement penalties of 500 times the normal rate apply to these MNE groups with a minimum penalty of $165,000 for up to one month late. While both the OECD and ATO have advised no penalties should apply where an MNE has taken reasonable measure to comply, there are still concerns about the lack of information required so close to the due date.
Exant Advisory already assists MNE groups with advice and lodgement for their Country by Country (CbC) reporting compliance and will work with clients to assist with relevant GloBE compliance.
Please contact Exant Advisory’s tax partner, Jamie Towers for further information in this regard, via the form below or on 07 3218 3900.
