Compliance
How Australia’s Pillar Two Rules Will Reshape Global Minimum Tax Compliance for Multinationals
Australia’s implementation of OECD Pillar Two rules brings significant changes: global and domestic minimum taxes now apply, compliance deadlines are set, and transitional reliefs are available under new ATO guidance.
By NomadicTax Research Team • 5-8 min read • February 27, 2026
## What Are Australia’s Pillar Two Rules?
Australia has officially legislated key aspects of the OECD/G20 two-pillar global tax reform—known as **Pillar Two**. Under the legislation:
- The **Income Inclusion Rule (IIR)** and **Domestic Minimum Tax (DMT)** apply for fiscal years starting on or after **1 January 2024**. ([ato.gov.au](https://www.ato.gov.au/about-ato/new-legislation/in-detail/international/implementation-of-a-global-minimum-tax-and-a-domestic-minimum-tax?utm_source=openai))
- The **Undertaxed Profits Rule (UTPR)** applies beginning **1 January 2025**. ([ato.gov.au](https://www.ato.gov.au/about-ato/new-legislation/in-detail/international/implementation-of-a-global-minimum-tax-and-a-domestic-minimum-tax?utm_source=openai))
These measures ensure large multinational enterprise (MNE) groups with global revenue of **EUR 750 million or more** pay at least **15% tax** in each jurisdiction where they operate. ([ato.gov.au](https://www.ato.gov.au/about-ato/new-legislation/in-detail/international/implementation-of-a-global-minimum-tax-and-a-domestic-minimum-tax?utm_source=openai))