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Date: 9–11 November 2025 
Location: Crowne Plaza Hobart, Tasmania 

SW will be co-hosting the 2025 Australia National Conference of the CCCA Energy & Resources Committee, alongside the CCCA Melbourne Branch. The event will bring together leaders across government, industry, and academia to discuss developments in the energy and resources sectors, with a focus on sustainability, innovation, and strategic partnerships. 

Register here

Event agenda 

Sunday, 9 November  

Monday, 10 November

 Tuesday, 11 November

Register here

Conference details & participation

Why it matters

The conference promises to be an engaging day filled with insightful discussions, thought-provoking presentations, and valuable networking opportunities. Attendees will have the chance to share knowledge and connect with industry leaders, as the event explores how innovation, collaboration, and sustainability are reshaping the energy and resources sector – key considerations in future proofing businesses for long-term success. 

澳大利亚税务局（ATO）发布了新指南，帮助大型跨国公司履行支柱二税务规则规定的义务。虽然这些公司要处理的文件多了，还有可能面临处罚，但 ATO 会对过渡时期切实开展合规工作的企业宽大处理。   

总览

实务合规指南草案 PCG 2025/D3 概述了 ATO 在过渡时期（2026 年 12 月 31 日或之前开始、2028 年 6 月 30 日或之前结束的财政年度）对申报义务和处罚的过渡性合规办法。

澳大利亚实施了 15% 的全球与国内最低税率（支柱二规则），这与支柱二项下的经合组织全球反税基侵蚀（GloBE）规则保持一致。其对象是受测年度之前的四个财政年度内至少有两个财政年度合并收入≥7.5 亿澳元的大型跨国企业（MNE）集团。支柱二规则自 2024 年 1 月 1 日起适用于澳大利亚。

值得注意的是，自 2025 年 1 月 1 日起，未征低税利润规则可能会使澳大利亚的跨国企业集团成员承担其他集团成员的相关补税。这与前者是否对后者拥有任何所有者权益无关。因此，审计人员可能要求对全球集团 2025 财年的情况开展支柱二分析。

澳大利亚的主要申报义务有哪些？

适用的跨国企业集团必须提交以下材料：

  1. GloBE 信息申报表（GIR）– 经合组织计算税务负债的标准化表格。
  2. 海外通知表（FNF）– 通知 ATO 海外申报 GIR 的情况。
  3. 澳大利亚 IIR/UTPR 纳税申报表（AIUTR）– 根据收入包含规则（IIR）和未充分纳税利润规则（UTPR）评估补税。
  4. 澳大利亚国内最低报税表（DMTR）— 对澳大利亚低征税利润进行补税评估。

AIUTR、DMTR 和 FNF 被并入全球与国内统一最低报税表（CGDMTR）。GIR 仍是一项独立的义务。第一年的申报截止日期为财政年度结束后 18 个月，此后为 15 个月。对于以 2024 年 12 月 31 日为财政年度末的跨国企业集团，申报截止日期为 2026 年 6 月 30 日。

重点注意：跨国企业集团的澳大利亚成员必须在澳大利亚履行申报义务，即使集团母公司所在国没有实施支柱二规则。澳大利亚各实体可指定由一家澳大利亚集团实体（称为“指定本地实体”，简称DLE）代表澳大利亚实体提交报税表。

截至本文件发布之日，澳大利亚尚未签署支柱二项下的《关于全球反税基侵蚀信息交换的多边主管机构协议》（MCAA）。在此之前，必须在澳大利亚向 ATO 提交 GIR，即使该 GIR 已在海外提交。

对纳税人的处罚是否会“软着陆”？

在过渡期内，如果跨国企业集团证明自己采取了合理措施遵守有关规定，ATO 将采用“软着陆”办法（即减免罚款）。

以下对这些合理的措施举例说明：

此外，在过渡时期，个别无心之失应该不会被处罚。然而，若以事不关己的态度待之，或未按常理谨慎处理，则可能会受到处罚。目前对大型全球实体实施的行政处罚适用于这些情况。

信永中和如何协助？

我们可以通过以下方式协助贵公司实施支柱二项目：

The High Court has handed down its long-awaited decision in Commissioner of Taxation v PepsiCo, Inc [2025] HCA 30 (PepsiCo), with a 4–3 majority finding in favour of the Taxpayer in the protracted ‘embedded’ royalty dispute with the Commissioner.

The High Court has, by a 4-3 majority, dismissed the Commissioner’s appeal ruled in favour of the taxpayer.

The majority held that payments for the concentrate were not to any extent for the use of intellectual property (IP). Accordingly, there was no ‘embedded royalty,’ and PepsiCo and Stokely-Van Camp (SVC) had not obtained a tax benefit. Therefore, they were not liable for diverted profits tax (DPT).

Notably, the full Bench agreed that no royalty withholding tax (RWHT) arose as payments were not derived by PepsiCo or SVC.

This outcome followed PepsiCo’s successful appeal in June 2024 when the Full Federal Court overturned the primary Judge’s decision. A summary of the background and earlier judgements is discussed in our previous article.

Due to the High Court decision, the ATO is considering any broader impact the decision may have on the reasoning set out in Draft Tax Ruling 2024/D1. However, this loss will unlikely deter the ATO from reviewing multinationals of their intangible / distribution arrangements.  

High Court decision

The High Court majority held that:

Payments were for concentrate only

On the proper construction of the exclusive bottling agreements (EBA), the payments made by SAPL to PBS were for concentrate only, not for trademarks or intellectual property. The High Court gave significant weight to the agreement being entered into between two arm’s length parties. This significantly determined the nature of the transactions and the relevant tax laws. The arm’s length nature of the agreement established that the transactions were conducted on commercial terms, influencing the High Court’s decision on the liability for royalty withholding tax and diverted profits tax.

No royalty withholding tax liability

Even if the payments included a royalty component, such amounts were not income derived by, and were not paid to, PepsiCo or SVC. As payments were made to PBS (an Australian resident) rather than to the US entities, the conditions for RWHT under section 128B of the ITAA 1936 were not satisfied. This aspect of the decision was unanimous across the full bench.

ATO’s argument rejected

The Commissioner argued that unless part of the concentrate price was treated as a royalty, SAPL would have obtained the right to use PepsiCo’s intellectual property for free. The majority rejected this reasoning as the more successful SAPL was in selling Pepsi-branded products, the more valuable the PepsiCo IP became. From a commercial aspect, this was not “nothing,” and there was no legal or economic basis to reallocate part of the concentrate price to a separate royalty component.

No diverted profits tax exposure

On DPT, the majority found the Commissioner’s proposed counterfactuals (e.g. stripping out the royalty-free licence provisions) were not commercially realistic, especially given PepsiCo’s longstanding franchise arrangements since the early 1900s. Furthermore, the arrangements did not meet the principal purpose test under section 177J of the ITAA 1936. Apart from a potential US tax saving, the Commissioner’s case lacked commercial support. The amount of royalty WHT allegedly avoided was negligible for such large multinational businesses.

Key implications for multinational groups

Close result

The High Court decision was delivered by a 4–3 majority, following a 2–1 split in the Full Federal Court and a single judge (in the Commissioner’s favour). This narrow margin at all levels of Courts underscores that the outcome was not definitive and future cases with different facts could be decided differently.

How SW can help

Our experts can assist with advising how this outcome affects your existing and prospective cross-border arrangements. We can also engage with the ATO to deal with potential disputes.

Reach out to your SW advisor for support from our Corporate Tax team.

Contributors

Antony Cheung

Alan Tong

The ATO released new guidance helping large multinational companies navigate their obligations under Pillar Two tax rules. While these companies face additional paperwork and potential penalties, the ATO is taking a lenient approach during the transition period for businesses making genuine compliance efforts.

Overview

Draft Practical Compliance Guideline PCG 2025/D3 outlines the ATO’s transitional compliance approach for lodgement obligations and penalties during the transition period (fiscal years starting on or before 31 Dec 2026 and ending on or before 30 June 2028).

Australia has introduced a 15% Global and Domestic Minimum Tax (Pillar Two Rules) aligned with the OECD’s Global Anti-Base Erosion (GloBE) Rules under Pillar Two. This targets large multinational enterprise (MNE) groups with consolidated revenues ≥ EUR750 million (AU$1.2 billion or US$820 million) in at least two of the four fiscal years preceding the tested year. The Pillar Two rules apply in Australia from 1 January 2024.

It is noteworthy that effective from 1 January 2025, the Undertaxed Profits Rule may subject an Australian MNE group member to top-up tax related to another group member. This is regardless of whether the former has any ownership interests in the latter. Consequently, auditors might require a Pillar Two analysis for the global group for the 2025 fiscal year.

What are the key lodgement obligations in Australia?

Applicable MNE Groups must lodge the following:

  1. GloBE Information Return (GIR) – OECD- standardised form for calculating tax liability.
  2. Foreign Notification Form (FNF) – Notifies the ATO of foreign GIR lodgement.
  3. Australian IIR/UTPR Tax Return (AIUTR) – Assesses top-up tax under Income Inclusion Rule and Undertaxed Profits Rule.
  4. Australian Domestic Minimum Tax Return (DMTR) – Assesses top-up tax on low-taxed Australian profits.

The AIUTR, DMTR, and FNF are consolidated into the Combined Global and Domestic Minimum Tax Return (CGDMTR). The GIR remains a standalone obligation. The returns are due 18 months after the fiscal year end for the first year and 15 months thereafter. For an MNE group with a fiscal year ending on 31 December 2024, the returns are due on 30 June 2026.

Importantly, the Australian members of an MNE Group must fulfil lodgement obligations in Australia, even if the Parent of the Group is in a country without Pillar Two rules implemented. The Australian entities may nominate one Australian Group Entity, known as the Designated Local Entity (DLE), to lodge the returns on behalf of the Australian entities.

As of the date of this document, Australia has not signed the Multilateral Competent Authority Agreement (MCAA) on the Exchange of GloBE Information (GIR MCAA) under Pillar Two. Until that happens, the GIR must be lodged in Australia with the ATO even if one has been lodged overseas.

Is there a “soft landing” in terms of penalties for taxpayers?

During the transition period, the ATO will adopt a “soft-landing” approach (i.e. penalties remitted) if the MNE group has demonstrated that reasonable measures were taken to comply.

Examples of reasonable measures include:

Furthermore, no penalties should be imposed for isolated or good-faith errors during the transition period. However, gross indifference or failure to take reasonable care may be subject to penalties. Current administration penalties imposed upon Significant Global Entities apply in these circumstances.

How can SW assist?

We can assist with your Pillar Two project implementation by:

Contributors

Antony Cheung

The regulator AUSTRAC has launched civil penalty proceedings against an NSW community club for serious and systemic non-compliance with Australia’s Anti-Money Laundering and Counter-terrorism Financing (AML/CTF) requirements. 

Weaknesses of the AML/CTF program:

Each contravention attracts a maximum civil penalty between $21m and $31.3m. 

Key learnings include: 

How SW can help

SW will continue to monitor developments in AML/CTF compliance and share insights as they arise. 

Reach out to your SW contact or our specialist advisers for guidance on how these learnings may impact your club

Contributors

Freddie Deegan

Never a dull moment in US politics and tax policies – the proposed section 899 has come and gone in a matter of weeks. What are the ramifications for Pillar Two? 

Just few weeks after the US Congress passed the One Big Beautiful Bill Act (the OBBBA), including the controversial Section 899 ‘revenge tax’, the Senate has implemented a number of changes to the OBBBA. The revised version of the OBBBA excludes this revenge tax. This change comes after a recommendation from US Treasury Secretary Scott Bessett to remove the tax as part of a deal with the G7 nations (Canada, France, Germany, Italy, Japan, the United Kingdom and the United States). This removal follows widespread concern that the tax was expected to reduce foreign investment into the US costing US jobs.   

This version of the OBBBA narrowly passed in the US Senate on 1 July 2025 with Vice President Vance casting the tie breaking vote. Now the OBBBA needs to be reconsidered by Congress prior to the 4 July deadline self-imposed by President Trump. 

Arising from the deal with the G7 nations is the newly proposed ‘side-by-side’ solution, whereby US-parented multinational groups would be exempt from the Income Inclusion Rule (IIR) and the Undertaxed Profits Rule (UTPR) under the Organisation for Economic Cooperation and Development’s (OECD) Pillar Two. This is on the basis that the US has its own domestic minimum tax rules.  

The removal of proposed Section 899 is great news for Australian entities with investments and/or business interests in the US. This is because there will not be an increase of 5% per annum, for up to an additional 15% beyond the existing reduced treaty rate. Furthermore, no change to the minimum tax of 10% imposed on large corporations per the base erosion and anti-abuse tax (BEAT) regime.  

Considering the US parent group exemption is struck between the US and G7 nations (which does not include Australia), the impact on Australia’s implementation of Pillar Two is currently unclear. This is a live issue for multinationals, given the IIR and DMT, and UTPR apply to income years starting 1 January 2024 and 2025, respectively.   

G7 statement on global minimum taxes 

Following the signing of executive order in January this year by President Trump to ‘defend US tax sovereignty’ and outlining concerns regarding the Pillar Two rules agreed by the OECD/G20 Inclusive Framework (representing over 140 countries), the US and G7 nations came to a joint understanding in their recent summit addressing global minimum tax and tackling tax planning and avoidance. The ‘side-by-side’ arrangement is based on the following principles: 

In return for the US parented group exemption, the proposed section 899 ‘revenge tax’ has been removed from the Senate bill, which was passed overnight.

What this means to Australia (and Pillar Two)

The removal of section 899 will be welcomed by Australian groups that invest and conduct business in the US. This is particularly relevant for superannuation funds taxed at 15% in Australia, where the additional US tax could not be credited and would have directly and immediately impacted investment returns.

This G7 announcement also represents a landmark change to the international tax environment as Pillar Two was developed due to global concerns over the digital economy and base erosion, which worsened in the past two decades.  

Noting the Australian domestic minimum tax and IIR, and UTPR affect income years commencing 1 January 2024 and 2025, many practical issues remain unsolved: 

How SW can help

The ever-evolving nature of US and global tax policies require continued vigilance from Australian entities and their advisors. 

SW will monitor and keep you informed as developments happen.  

Reach out to your SW contact or our specialist tax contacts listed in this alert for advice.  

Contributors

Antony Cheung

Jarrod Newell 

General interest charge (GIC) and Shortfall Interest Charge (SIC) incurred from 1 July 2025 will no longer be deductible, increasing the after tax cost of carrying a tax debt. 

Taxpayers have historically been able to claim tax deductions for GIC and SIC imposed by the ATO. This helped offset the financial burden of these penalty interest charges which are designed to encourage timely tax payments. 

However, the Treasury Laws Amendment (Tax Incentives and Integrity) Act 2025, which received Royal Assent on 27 March 2025, changes this treatment. 

From 1 July 2025, any GIC or SIC incurred will not be deductible regardless of whether the debt relates to an earlier income year. If you have a Substituted Accounting Period (SAP), these changes will apply to you from your next accounting period starting after 1 July 2025. 

These changes aim to encourage timely and accurate tax payments by increasing the financial cost of tax debt.

Background

Understanding the nature of these interest charges is fundamental to grasping the significance of this change.

The timing of when interest charges are “incurred” becomes critically important under the new rules. Interest charges are considered incurred when the ATO issues an assessment, not when they accrue daily. Thus, an amended assessment issued on 30 June 2025 would result in fully deductible SIC, while the same assessment issued two days later would be non-deductible, regardless of how much of the interest period relates to pre-July 2025. 

The legislation also addresses the corresponding treatment of remissions, creating a logical symmetry in the tax system. Since GIC and SIC will no longer be deductible when incurred after 1 July 2025, any subsequent remission of these charges by the ATO will no longer need to be included as assessable income.

Who is impacted?

Every Australian taxpayer with a tax debt is affected but the impact depends on individual circumstances.  

Small and medium enterprises face the most severe consequences, representing a significant portion of the ATO’s collectable debt and often have limited access to alternative financing. These businesses frequently rely on ATO payment plans during cash flow difficulties, making the increased cost burdensome. 

Taxpayers with existing ATO payment arrangements extending beyond 1 July 2025 need particular attention as any GIC accruing after this date will be non-deductible even if it relates to pre-existing debt. 

What is the impact?

The financial impact goes beyond the immediate loss of tax deductions. Effective costs of GIC increased to full statutory rates, making the ATO debt among the most expensive forms of financing for businesses, often more costly than loans or credit facilities.

Cash flow planning becomes more complex as businesses must budget for the full cost of any potential tax penalties. The change also affects the strategic value of voluntary disclosures as the cost of resulting SIC cannot be partially offset through tax deductions. 

Resultantly, the measure creates hardship for taxpayers already in financial difficulty. Unlike commercial lenders offering payment holidays or restructured terms during hardship, the ATO’s remission process remains rigorous and uncertain. This could force businesses to seek more expensive emergency financing rather than manage their tax debt through extended payment arrangements. 

For professional advisors, the change necessitates more proactive tax planning and closer monitoring of compliance deadlines. The increased cost of penalties makes preventive advice more valuable while raising stakes for compliance failures. 

Steps to take

Settle outstanding tax debts and review current arrangements

Immediate action is required before 1 July 2025 to minimise exposure to non-deductible charges. Taxpayers should prioritise clearing any outstanding tax liabilities by reviewing and accelerating existing payment arrangements with the ATO.  

Where full payment is not possible, exploring alternative financing options with deductible interest should be considered. 

Professional review of tax compliance processes can prevent future GIC and SIC charges. You can avoid payment delays by implementing robust systems to meet lodgement deadlines, ensuring accurate self-assessment, and establishing better cash flow forecasting. 

Consultation and planning

For taxpayers with complex affairs or with previously incurred regular penalty charges, professional advice should be sought immediately. Consultations should focus on:

Businesses should review their financial forecasting and budgeting processes to factor in increased cost of any future tax penalties. Additionally, insurance products or facility arrangements providing emergency tax funding should be explored for comprehensive risk management. 

How SW can help

SW can help you navigate this significant transition through urgent pre-30 June 2025 reviews of current tax positions and outstanding liabilities.  

We can guide you on opportunities for voluntary amendments remaining fully deductible, assist with clearing your existing debts before the deadline, and analyse more cost-effective financing arrangements that are than extended ATO payment plans incurring non-deductible interest charges from July 2025. 

We can also discuss ways to strengthen your tax compliance framework. This includes implementing robust systems to prevent future penalty charges, restructuring cash flow planning to account for the higher after-tax cost of tax debt, and providing expert advocacy when ATO remission applications may be warranted.  

Our comprehensive approach ensures clients understand the technical timing complexities of these changes and practical steps needed to minimize their long-term financial impact. 

Contributors

Rahul Sanghani

Sarah Hong

On 22 May 2025, the United States (U.S.) House of Representatives passed section 899, a retaliatory and penalty tax targeting inbound investments to the U.S. by foreign entities from countries (including Australia) imposing ‘discriminatory taxes’ against U.S. entities.

As part of the One Big Beautiful Bill Act (the Bill) passed by the U.S. House of Representatives, section 899 Enforcement of Remedies Against Unfair Foreign Taxes will be introduced to the Internal Revenue Code and expected to affect Australian entities from 1 January 2026. This is implemented as a retaliatory tax against foreign countries that the U.S. deems to have ‘unfair foreign taxes’ imposed on U.S. multinationals and individuals operating overseas. The Bill will now go to the U.S. Senate, where passage is likely but not assured.

As Australia will satisfy the definition of a discriminatory foreign country (DFC) this tax will adversely impact all Australians who invest or do business in the U.S. Australian taxpayers will have an additional 5% of tax levied upon their U.S. source income and certain capital gains in the first year and increasing by 5% annually. The section intends to override the reduced treaty rates under the U.S. – Australia Double Tax Agreement (DTA), but the agreed rate is used as the baseline for subsequent increases and capped at 20% above the statutory rate.

Background

On 20 January 2025, President Trump signed an executive order declaring that the OECD global tax deal does not apply to the U.S. A memorandum followed, warning that the U.S. would retaliate against any foreign country imposing unfair or extraterritorial taxes on U.S. citizens or companies.

Under the proposed section 899, a DFC is a country that has any of the following in force:

Whilst the Treasury Secretary must issue quarterly reports listing DFCs, Australia is on the ‘blacklist’, considering the ‘bad’ taxes DPT and DST have been in force since 2018 and the UTPR commenced on 1 January 2025.  

Who is affected

The proposed Section 899 levies an additional tax on ‘applicable persons’, defined as any of the following entities:

How Section 899 tax applies

Section 899 provides for increased rates of tax with the five categories:

The tax rate would be a 5% increase in the first year and would increase by 5% each year after.

By way of examples:

When would it apply

If the Bill passes U.S. Senate, section 899 would apply to Australian entities from income years commencing 90 days after the date of enactment. Given the U.S. has a 31 December year end it is expected that this would commence from 1 January 2026.

Should we be concerned

The constant changes in U.S. fiscal and economic policies mean that we are living in a world of uncertainties and financial pain. Whether you are a multinational or an individual with superannuation savings, you will be adversely impacted by this proposed tax.

Australian entities should evaluate the impact of the proposed tax if they

How SW can help

SW will continue to monitor and keep you informed on a timely basis on further developments in this space.

We encourage you to discuss with your SW contact or the specialist tax contacts listed in this alert on how the proposed tax may impact you.

Contributors

Antony Cheung

With the Federal Election now run and won, the Federal Labor Government will re-introduce its proposed legislation – Division 296 – Better targeted superannuation concessions.

The legislation targets individuals with a Total Superannuation Balance (TSB) above $3 million held across all super funds regardless of accumulation or retirement phase.

Under the previously proposed legislation that lapsed prior to the election, the proposed start date was 1 July 2025.

The Division 296 tax introduces a 15% tax on earnings from superannuation balances that exceed $3 million at the end of each financial year.

This tax does not apply to the total superannuation balance, only earnings attributed to the balance above $3 million.

The current proposed legislation does not index the $3 million threshold.

Calculating the Division 296 tax liability

Calculation of earnings

Earnings = (TSB at the end of the current year + Withdrawals – Net Contributions) – TSB previous financial year

Calculation of proportion earning attribute to balances above $3 million

Proportion of earnings = (TSB at the end of the current year – $3 million)/TSB previous financial year

Calculation of tax liability

Tax liability = 15% x Earnings x Proportion of Earnings

Example calculation

Pete has the following balance in superannuation as of:

During the year Pete contributed $30,000 to superannuation

During the year Pete withdrew via an account-based pension $80,000

Earnings = ($4,300,000 + $80,000 – $30,000) – $4,000,000 = $350,000

Proportion of Earnings above $3 million = ($4,300,000 – $3,000,000)/ $4,000,000 = 32.5%

Tax Liability = 15% x $350,000 x 32.5% = $17,062.50

Payment of Division 296 tax liability

The individual will choose how to pay, either paying the tax personally or releasing funds from superannuation. 

Taxation of unrealised gains

As a result of the calculation, Division 296 taxes unrealised gains. This means that superannuation members will be taxed on the increase in the value of their investments even if the investment has not been sold or disposed of.

Some superannuation funds that hold illiquid assets such as property or unlisted investments may be compelled to sell assets prematurely or in adverse market conditions.

Division 296 losses

When the earnings are negative, these amounts can be carried forward so long as the TSB is greater than $3 million at the start or end of the year. These amounts can be offset against future positive earnings before applying the proportion calculation.

How SW can help

At this stage it is unclear what the final legislation will look like, or if indeed the start date will be 1 July 2025.

Valuations will be scrutinised for assets that do not have a readily available market price such as property and unlisted investments.

Keeping funds in superannuation remains the most tax-effective choice for some members.

There is still time to assess the impact of the proposed legislation to implement strategies prior to 30 June 2026.

Superannuation members should wait until the final legislation is passed before withdrawing large superannuation balances. Once funds are outside superannuation you may not be able to re-contribute them back.

You should seek professional advice from your SW contact as each superannuation member’s taxation circumstances will differ.