Australia: Legislation requiring disclosure of subsidiaries' tax residence in financial reports enacted
Public companies will now be required to include a "consolidated entity disclosure statement" in their annual financial reports.
Public companies will be required to include a "consolidated entity disclosure statement"
The Treasury Laws Amendment (Making Multinationals Pay Their Fair Share – Integrity and Transparency) Act 2024, which introduces new requirements for Australian public companies to disclose subsidiaries’ tax residence in financial reports for financial years beginning on or after 1 July 2023 (i.e., annual financial reports for 30 June 2024), passed both houses of parliament on 27 March 2024 and received Royal Assent on 8 April 2024. Read TaxNewsFlash
Public companies will now be required to include a "consolidated entity disclosure statement" in their annual financial reports, disclosing detailed information about entities within the consolidated entity including:
- Names
- Legal structures
- Locations of incorporation or formation
- Tax residency status
KPMG observation
Determination of a subsidiary’s tax residence will require judgement. In many cases, it will be necessary to obtain Australian and/or foreign tax advice to confirm the tax residency of a subsidiary, which should form part of the public company’s governance processes.
Read an April 2024 report prepared by the KPMG member firm in Australia
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