Reporting Update 25RU-02
The Treasury Laws Amendment (Making Multinationals Pay Their Fair Share – Integrity and Transparency) Act 2024 (Amendments) passed both houses of parliament on 27 March 2024 and received Royal Assent on 8 April 2024. Minor clarifications were enacted in December 2024 subsequently in relation to these disclosures by the Treasury Laws Amendment (Fairer for Families and Farmers and Other Measures) Act 2024 (the Amending Act).
Key requirements
The Act addresses tax transparency measures for multinational groups and impacts all Australian public companies (listed and unlisted). The Act changed the Corporations Act 2001 (Corps Act) to require Australian public companies to prepare a ‘Consolidated Entity Disclosure Statement’ (CEDS). The CEDS requires information to be disclosed for each entity in the consolidated financial statements, including the tax residency of each of those entities at the end of the financial year.
The declaration of the directors under the Corps Act was expanded to include a declaration that the disclosures are in their opinion ‘true and correct’ at the end of the financial year. The requirement is effective for financial years ended 30 June 2024 and onwards.
- names
- legal structures
- locations of incorporation or formation
- tax residency status
The Amending Act clarified the following in December 2024:
- Tax residency disclosures where entities are resident in more than one jurisdiction; and
- Inserting a definition of ‘Australian resident’ for Partnerships and Trusts
These clarifications apply to financial years commencing on or after 1 July 2024, i.e. annual financial reports for 30 June 2025 and onwards.
Changes may be needed to disclosures with the clarification of some of the interpretive positions taken in applying the CEDS requirements. Consistent with the original requirements, it is anticipated that the additional disclosures relating to multiple tax residencies for entities may require substantial judgement and involvement of legal or tax specialists. We encourage continued consideration of the impact on your governance processes in ensuring that any required additional information needed is complete and accurate.
Download Reporting Update
We unpack the CEDS requirements including the minor clarifications further in our Reporting Update.
Frequently asked questions
The CEDS requirements was enacted in April 2024. What developments have there been since then?
- In July 2024, ASIC released Information Sheet 284 to provide guidance for preparers of financial reports to ensure that CEDS comply with the requirements of the Corps Act and are consistent with the policy intent of the legislation.
- In September 2024, the Treasury released an Exposure Draft Bill Treasury Laws Amendment Bill 2024: Minor and technical Amendments (Spring 2024) to propose amendments to clarify CEDS disclosures for financial years commencing on or after 1 July 2024, i.e. annual financial reports for 30 June 2025 and onwards.
- In November 2024, the Treasury released Draft Bill Treasury Laws Amendment (Fairer for Families and Farmers and Other Measures) to clarify CEDS disclosures which was subsequently approved and received Royal Assent in December 2024.
What has changed for public companies with a financial year ending 30 June 2025 and onwards?
- Where an Australian tax resident is also a tax resident in another jurisdiction, now required to disclose ALL foreign jurisdiction(s) tax residencies.
- ‘Australian resident’ is now defined for Partnership and Trust for the purpose of CEDS.
What is the application date for the CEDS requirements?
- Applies to annual financial reports of public companies for financial years commencing on or after 1 July 2023 and onwards.
- Minor clarifications as a result of the Amending Act apply to financial years commencing on or after 1 July 2024 and onwards.
Where can I locate an example CEDS disclosure?
Appendix 1 in our Reporting Update (PDF 472KB) illustrate disclosure of a CEDS.
