The Australian Taxation Office (ATO) has issued a clear and firm reminder to Significant Global Entities (SGEs) about their obligations regarding the Taxable Payments Annual Report (TPAR), following the 28 August deadline.
A recent case in the 2024–25 financial year underscores the serious consequences of non-compliance, resulting in a $639,600 Failure to Lodge (FTL) penalty for a single entity. This highlights the ATO’s expectation that SGEs, with their substantial resources, have robust systems in place to meet all lodgement deadlines.
The Stakes for SGEs: Billions in Payments and Major Penalties
The TPAR is a critical compliance tool for the ATO to track payments to contractors and ensure proper tax reporting. For SGEs, the scale is significant:
In the 2023–24 financial year, 1,450 SGEs lodged TPARs.
These reports disclosed over $89.5 billion in gross payments and $7.6 billion in GST.
Payments were made to more than 720,000 contractors.
Given this volume, the ATO emphasises that late lodgement by SGEs can have “significant consequences.” Penalties for late TPARs can reach up to $825,000 for an SGE.
Key Compliance Points for Corporate Groups
For SGEs operating as part of a corporate group, specific rules apply:
If a consolidated or notional listed company group is classified as an SGE, all member entities are deemed to be SGEs.
Crucially, each entity must lodge its own TPAR individually; a head entity cannot lodge a single report on behalf of the group.
It is essential for businesses to self-assess their SGE status correctly to understand their obligations.
Actionable Advice for Businesses
To avoid severe penalties, businesses that pay contractors for services should:
Confirm Obligations: Determine if your business is required to lodge a TPAR. This generally applies if you make payments to contractors for specific services like building and construction, cleaning, or IT services.
Verify SGE Status: Assess whether your entity or corporate group meets the definition of a Significant Global Entity (global income of $1 billion or more).
Lodge Immediately if Overdue: The deadline was 28 August. If you have not yet lodged your TPAR for the 2023-24 year, you should do so immediately to mitigate further penalties.
Use ATO Resources: Visit the ATO’s Lodge your TPAR page for detailed guidance on what to report and how to lodge.
Bottom Line: The ATO’s message is unambiguous: it will hold large entities accountable for timely reporting. For SGEs, ensuring compliance with TPAR obligations is not just about avoiding multi-million dollar penalties; it’s a fundamental expectation of their role in the Australian tax system.
Need help determining your TPAR or SGE obligations? Our team can assist with your status assessment and lodgement process to ensure full compliance.
Disclaimer: Any advice on this site is general nature only and has not been tailored to your personal objectives, financial situation and needs. Please seek personal advice prior to acting on this information. Because of that, before acting on the advice, you should consider its appropriateness to you, having regard to your objectives, financial situation or needs.
