Large Business Stewardship Group key messages 4 June 2025

Co-chair update

The Australian Taxation Office (ATO) provided an update on work leading up to the end of financial year and priorities for the months ahead, including reviewing performance and the findings reports, corporate tax transparency report and research and development (R&D) tax incentive report. The ATO discussed expected changes and the timeline for the publication of the reports.

Public country-by-country reporting

The ATO provided members with an update on the progress of the implementation of the Public country-by-country (CBC) reporting regime. The update covered the status of the Law Administration Practice Statement (PSLA) on Public CBC reporting exemptions, stakeholder engagement and consultation, the registration and lodgment process and emerging issues regarding entities within scope.

Members sought clarification on the exemptions process and correction of errors. The ATO sought feedback on the registration form prior to it being published in June and indicated web content will also be updated to provide instructions when the form is published.

Justified trust

The ATO provided members with an update on the implementation of the Supplementary annual GST return. Web guidance for the supplementary return has been updated, and a copy of the return and instructions have also been published. Members queried whether taxpayers who have received notifications to lodge can apply for extensions. The ATO confirmed that taxpayers can request an extension, however given the notifications were sent out several months in advance, the ATO does not expect there to be a great need for taxpayers to seek extensions.

The ATO also provided information on the Top 100 approach for GST. Members discussed the GST analytical tool (GAT) and the need for clarity in relation to its use and associated benefits. The ATO reiterated the reasons why the GAT is required and the risk it is attempting to address. The ATO will undertake consultation to determine the Top 100 approach for GST going forward.

Use of automation tax technology

Members led a discussion on the use of automated tax technology and sought the ATO’s views. Comments from members focused on the uncertainty around the accepted use of automated tax technology in relation to income tax. The ATO has looked at various aspects of automation and will look at holding discussions with members around core artificial intelligence technology in future.

Service delivery

The ATO provided members with an update on:

• the status of processing work
• a resourcing initiative focused on large market processing
• its response to feedback from the Corporate Tax Association in July 2024
• a proposed working group to enhance large business interactions with the ATO.

Members enquired about the use of automation in processing, the logistics and expected outcome from proposed workshops to be held through the working group. The ATO clarified the objective of the workshops and noted the valuable engagement opportunity for Top 1,000 taxpayers and requested members to advise their networks.

Compliance risk and emerging issues

Medium public and multinational business engagement program – voluntary disclosures

The Medium public and multinational business engagement program page on ato.gov.au outlines key tax risks. Taxpayers are expected to regularly review their tax affairs as good practice. For more information about voluntary disclosures and how to lodge, see Voluntary disclosures in the approved form.

LCMSF V4 for CBC reporting and changes to the RTP Schedule

ATO systems began accepting Local File/Master File (LCMSF) V4 lodgements on 2 January 2025, with successful submissions of Local and Master Files. Queries on V4 can be sent to LCMSFversion4@ato.gov.au. Reportable tax position (RTP) schedule and international dealings schedule (IDS) instructions have been updated to reduce duplicate reporting for restructures reported in the short form local file.

Changes to the IDS for 2025

Advance copies of the 2025 IDS form and draft Section H instructions have been shared with stakeholders. The new instructions aim to reduce duplication by referencing disclosures made in the short form local file. The ATO acknowledged feedback about the consultation process and recognised earlier communication was needed.

R&D tax incentive transparency reporting

The ATO provided members with an overview of R&D tax incentive transparency reporting and the timeline for reporting of the 2022–23 income year data in September 2025. The information for the report is taken from the company tax return and R&D schedule and this year will include 2022–23 income year data as well as data for the 2021–22 income year that was not included in the report published in October 2024.

The communication campaign to provide information to tax agents and entities impacted by this year’s R&D tax incentive transparency reporting commenced in February 2025 and a second round of communications will issue in June.

Members enquired about the strategic review of R&D in Australia and the ATO’s involvement. Members also provided feedback around including further analysis and commentary in the report.

Pillar Two

The ATO provided an update on the activities undertaken as part of the external readiness strategy for Pillar Two, including issues and feedback received from members of the special purpose working group (SPWG). The ATO established a SPWG to discuss and seek feedback on administrative aspects of implementation of the Pillar Two measure, in particular any issues or topics from the primary and secondary legislation that will require further guidance and assistance for the market. Several sessions have been held where questions on various topics have been raised. Some issues have been addressed through updated website guidance.

Members commented on the positive experience with the process and the ATO’s engagement with taxpayers.

Commissioner update

The Commissioner of Taxation, Rob Heferen, shared his thoughts on the ATO’s vision, purpose and the response to the capability review published in March. The Commissioner was asked to provide his thoughts on automation and artificial intelligence, leadership and culture. Members also shared their thoughts on the main concerns for large market taxpayers.

Utilisation of large business compliance products

Members led a discussion on large business compliance products and their use in gathering information from taxpayers and other markets. Members noted the increasing complexity of meeting compliance obligations and the burden on the large taxpayer community. The ATO observed the use of the compliance products in the context of the risks being seen in the market and the attempts at streamlining and reducing the need for duplicate information.

Treasury

Treasury advised members the government has been clear on the priorities for this term. Following the announcement of the parliamentary sitting calendar the priority is the passage of legislation for better targeted superannuation concessions.

Members were also updated on international taxation and the monitoring of overseas developments following the 17th Plenary meeting of the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting in April. Members sought an update on the progress of unenacted measures.

Board of Taxation

The Board of Taxation (the Board) provided members with the following updates:

• Ms Rosheen Garnon stepped down as the Chair of the Board in early March. Dr Julianne Jaques is the Acting Chair until the new Chair is appointed.
• The Board met in May and reviewed the forward work program, including considering past reviews and work aligned with government priorities. The Board is looking at undertaking shorter reviews and the forward work program is under active consideration.
• The next Board meeting is scheduled for June in Melbourne and will include a stakeholder event.
• The draft redesigned voluntary tax transparency code has been published and is open for public consultation. The Board will also undertake targeted consultation with civil society, academics, corporates, advisors and signatories. The changes include a redesign, updating the objectives of the code, reducing reporting and compliance burdens, better integration with other tax transparency measures, and differentiation based on whether entities are within scope of the Public CBC reporting regime.
• The Board website now includes a Board’s Bulletin which will be released regularly following Board meetings to increase transparency.

Attendees

Guest attendees

Apologies