Australia’s minimum tax rules generally apply to fiscal years beginning on or after 1 January 2024.
The Australian Taxation Office (ATO) has released Practical Compliance Guideline (PCG) 2025/4, Global and domestic minimum tax lodgment obligations – transitional approach, on transitional approaches for global and domestic minimum tax lodgment obligations.
Australia’s minimum tax rules generally apply to fiscal years beginning on or after 1 January 2024, and the final PCG aligns with the previously consulted draft.
What this Guideline is about
Australia’s implementation of a 15% global and domestic minimum tax (Minimum Tax) introduces additional lodgment obligations for in-scope multinational enterprise groups (MNE Groups).
The Minimum Tax implements the Organisation for Economic Co-operation and Development’s (OECD’s) Global Anti-Base Erosion Model Rules (GloBE Rules). The GloBE Rules are a key aspect of Pillar Two of the OECD/G20 Two-Pillar Solution to address tax challenges arising from the digitalisation of the economy. The Minimum Tax lodgment obligations were inserted by the Treasury Laws Amendment (Multinational—Global and Domestic Minimum Tax) (Consequential) Act 2024 into Schedule 1 to the Taxation Administration Act 1953 (TAA). Failure to comply with these obligations can incur significant penalties.
This Guideline outlines our practical administrative approach to the enforcement of penalties during a transition period. This approach aims to balance the need to support taxpayers to understand and comply with their Minimum Tax obligations with the need to administer the legislation in a manner which is consistent with the OECD’s GloBE Rules.
This Guideline is intended to complement existing ATO guidance relating to our administration of lodgment obligations and penalties. It provides tailored advice to assist in-scope taxpayers to meet their obligations during the transition period.
This Guideline does not limit the operation of the law, nor replace, alter or affect our interpretation of the law in any way. It does not relieve you of your legal obligation to comply with all relevant tax laws.
This Guideline applies from 1 January 2024.
