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  • Significant global entities – penalties

    How increased penalties apply to significant global entities (SGEs).

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    Administrative statement penalties

    Administrative statement penalties are doubled from 1 July 2017 (twice the amount that applies to all other taxpayers) for SGEs that:

    • do not take reasonable care
    • take a tax position that is not reasonably arguable
    • fail to provide documents when required and we determine the liability without the document.

    Penalties for SGEs that enter into tax avoidance and profit shifting schemes that result in scheme benefits received from 1 July 2015 are also doubled, if they do not have a reasonably arguable position.

    Failure to lodge (FTL) on time penalties for SGEs have also increased by up to 500 times.

    From 5 December 2019, these increases also apply to SGE subsidiary members of income tax consolidated group or a multiple entry consolidated (MEC) groups.

    For more information see Significant global entities.

    The doubled penalty applies from:

    • 1 July 2017 for all other SGEs
    • 5 December 2019 for an SGE subsidiary member of a tax consolidated or MEC group
    • 1 July 2020 for entities satisfying the updated SGE definition per Treasury Laws Amendment (2020 Measures No. 1) Act 2020.
    SGE administrative penalties for shortfall amounts

    Culpable behaviour

    Base penalty percentage applicable to the shortfall amount

    Making a false or misleading statement

    50%, 100%, 150%

    Making a statement which treats a law as applying in a way that was not reasonably arguable


    Failing to provide a document as required


    SGE administrative penalties for no shortfall amounts

    Culpable behaviour

    Penalty units

    Intentional disregard

    120 penalty units


    80 penalty units

    No reasonable care

    40 penalty units

    See how we calculate penalties.

    Scheme penalties

    Administrative penalties are doubled for an SGE that enters into tax avoidance and profit shifting schemes, unless they have a reasonably arguable position.

    Doubled scheme penalties apply from:

    • 1 July 2020 for entities satisfying the updated SGE definition per Treasury Laws Amendment (2020 Measures No. 1) Act 2020
    • 1 July 2015 for all other SGEs.

    Failure to lodge (FTL) on time penalty

    The FTL on time base penalty amount is multiplied by 500 where the entity is an SGE. FTL penalties apply when they do not lodge an approved form by its due date. Examples of approved forms include:

    • income tax returns
    • activity statements and GST annual returns
    • fringe benefits tax returns
    • country by country reporting statements
    • general purpose financial statements
    • Single Touch Payroll reports
    • PAYG payment summary annual reports

    Increased FTL penalties apply:

    • fails to lodge an approved form on time where it was required to be lodged from 1 July 2017
    • subsidiary member that fails to lodge an approved form on time where it was required to be lodged from 5 December 2019.

    Approved forms that are discretionary, such as voluntary disclosures or objection requests, cannot have FTL penalties applied.

    SGE FTL penalty amount for forms due from 1 July 2023

    Days late

    SGE penalties

    28 or less


    29 to 56


    57 to 84


    85 to 112


    More than 112


    Before applying FTL penalties

    While we generally do not remind SGEs to lodge, we will issue a warning or reminder before we impose a late lodgment penalty.

    However, this is not required under law. Not receiving a warning or reminder from us is not grounds for non-imposition or remission of an FTL penalty.

    If an SGE has received previous warnings about lodging on time or FTL penalties, they should be extra vigilant to ensure all future lodgments are made on time.

    Avoid increased penalties

    To avoid penalties, SGEs are responsible for:

    • understanding their reporting obligations
    • lodging their approved forms on time without error.

    An SGE that takes reasonable care with their tax obligations will not incur a false or misleading statement penalty.

    An SGE will have the opportunity to seek a remission of the penalty.

    Lodgment deferrals

    If an SGE is unable to meet lodgment deadlines due to exceptional and unforeseen circumstances, they can request a deferral.

    Entities should request a lodgment deferral as soon as practicable once they believe they cannot meet a due date. If they lodge after the deferred due date it will be considered a failure to lodge on time and SGE penalties may be applied.

    Safe harbour

    All entities are responsible for ensuring their reporting obligations are accurate and up to date. The safe harbour provisions remove their liability to an FTL penalty or false or misleading statement penalty when:

    • their registered tax or BAS agent lodges the document late, or makes a false or misleading statement for reasons not due to the agent's intentional disregard or recklessness as to the operation of a tax law
    • the entity can show they provided their agent with all relevant information to enable them to lodge the document by the due date or make the correct statement.

    The entity carries the burden of proof to establish that they provided all relevant information as required to their registered agent.

    Automatic Exchange of Information

    We will apply the increased SGE penalties to Automatic Exchange of Information reporting requirements, including:

    • Common Reporting Standard
    • Foreign Account Tax Compliance Act.

    Both reports contain statements required to be lodged in an approved form.

    Practice statements

    The following practice statements provide guidance on our administrative practice for the imposition and remission of penalties to which the increases for SGEs apply:

    • MT 2008/1 Penalty relating to statements: meaning of reasonable care, recklessness and intentional disregard
    • MT 2008/2 Shortfall penalties: administrative penalty for taking a position that is not reasonably arguable
    • PS LA 2011/19 Administration of penalties for failing to lodge documents on time
    • PS LA 2012/5 Administration of penalties for making false or misleading statements that result in shortfall amounts
    • PS LA 2012/4 Administration of penalties for making false or misleading statements that do not result in shortfall amounts
    • PS LA 2014/2 Administration of transfer pricing penalties for income years commencing on or after 29 June 2013
    • PS LA 2014/4 Administration of the penalty imposed under subsection 284-75(3) of Schedule 1 to the Taxation Administration Act 1953.

    More information

    If you have any questions related to SGE penalties, email us at:

    For information on law changes that impact the application of SGE penalties, see:

    Last modified: 03 Jul 2023QC 53380