Australia: ATO issues guidance on Pillar 2 filing obligations

The ATO issued guidance on the transitional treatment of penalties for the four new Pillar 2 filing obligations, providing certainty for MNEs and adopting a “soft-landing” approach for reasonable compliance efforts during fiscal years starting on or before 31 December 2026 and ending by 30 June 2028.

The Australian Taxation Office (ATO) issued a guideline outlining its transitional approach to penalties and expectations for the four new Pillar 2 filing obligations on 26 November 2025, offering tailored guidance and certainty for MNEs during the transition period (fiscal years starting on or before 31 December 2026 and ending by 30 June 2028).

The ATO also clarified that it is adopting a “soft-landing” approach for those making reasonable compliance efforts.

Lodging, paying and other obligations for Pillar 2

New lodgment requirements

Four new lodgment requirements are introduced as part of the Australian global and domestic minimum tax, consistent with the Global Anti-Base Erosion Model Rules (GloBE Rules). These are:

1. GloBE Information Return (GIR)
2. Foreign lodgment notification
3. Australian IIR/UTPR Tax Return (AIUTR)
4. Australian DMT Tax Return (DMTR).

The forms are being developed in consultation with external stakeholders through the Pillar 2 Global and Domestic Minimum Tax Working Group and Digital Service Provider Working Group. These products will be available to taxpayers via Online services for business, Online services for agents and some business software providers in advance of the first lodgments, due by 30 June 2026.

GIR and foreign lodgment notification

The GIR is an information return:

• developed by the Organisation for Economic Co-operation and Development (OECD) Inclusive Framework
• containing data to enable tax administrators to assess a multinational enterprise groups’ (MNE groups) compliance with the GloBE Rules.

Consistent with the GloBE Rules, Subdivision 127-A in Schedule 1 to the TAA provides the ability for group entities to nominate another entity in the MNE group to lodge one single GIR on their behalf. This can comprise of:

• a designated local entity (DLE) lodging with the ATO
• a foreign UPE or a designated filing entity (DFE) lodging with a foreign government agency.

When lodging the GIR with a foreign government agency and not locally with the ATO, to effectively fulfill each Australian group entity’s GIR lodgment obligation:

• The GIR must be lodged on time in that foreign jurisdiction (if not met, the group will still have Australian filing obligations).
• Notification must be given to the Commissioner of Taxation by either each Australian group entity itself or the nominated DLE by lodging a foreign lodgment notification form, which we are currently developing.
• The foreign government agency that the GIR is lodged with must have a Qualifying Competent Authority Agreement (QCAA) with Australia. The GIR will then be exchanged with the ATO as per the QCAA and in line with the dissemination approach agreed by the OECD Inclusive Framework. If the GIR is lodged with a foreign government agency but it’s not exchanged with the ATO within the time period specified in the QCAA, the ATO may by written notice require that the GIR be locally lodged with the ATO.

An Australian group entity is required to give a GIR to the Commissioner even if the amount of Australian IIR/UTPR tax or Australian DMT tax is nil. There is also still an obligation to lodge the AIUTR and DMTR even if the GIR has been lodged overseas.

AIUTR and DMTR

The AIUTR and DMTR are Australian domestic tax returns. They are currently being developed to enable the triggering of Australia’s domestic assessment and pay provisions. The GIR is an information only return and does not result in a top-up tax assessment.

The AIUTR is for the global minimum tax, while the DMTR is for the domestic minimum tax.

Under Subdivision 127-A in Schedule 1 to the TAA, each group entity:

• is required to lodge an AIUTR where they have an Australian IIR/UTPR tax amount (including a nil amount)
• is required to lodge a DMTR where they have an Australian DMT tax amount (including a nil amount).

Entities have the option to nominate the DLE appointed to lodge the GIR to also file the AIUTR and DMTR on their behalf. An entity’s lodgment obligation will be fulfilled where the DLE lodges by the respective lodgment due date.

Lodgment due dates

The GIR, foreign lodgment notification, AIUTR and DMTR are required to be lodged:

• 18 months after the end of the first fiscal year, and
• 15 months after the end of the subsequent fiscal years.

The Commissioner has the ability to extend the lodgment deadline for the AIUTR and DMTR, but not the GIR or the foreign lodgment notification.

Lodgment due dates for the first fiscal year

Obligations and liabilities for specific entity types

GloBE permanent establishments

For GloBE permanent establishments located in Australia, all lodgment and payment obligations are placed on its main entity. The main entity is required to give the Commissioner a GIR, AIUTR, and DMTR in respect of the GloBE permanent establishment. The GIR and foreign lodgment notification requirements apply to the main entity as if it were located in Australia.

GloBE joint ventures

GloBE joint ventures (JVs) and GloBE JV subsidiaries are not required to separately lodge the GIR or the AIUTR. However, disclosure requirements regarding GloBE JVs and GloBE JV subsidiaries are required in the GIR for applicable MNE groups that hold ownership in GloBE JVs. GloBE JVs and GloBE JV subsidiaries of applicable MNE groups are also required to lodge the Australian DMTR.

Extended application to unincorporated entity types

Targeted rules accommodate different entity types to ensure obligations and liabilities imposed can be administered effectively.

For trusts, partnerships and other unincorporated entities, the TAA extends the entities to which obligations and liabilities in respect of the Australian global and domestic minimum tax apply.