Country-by-Country final local files released by the ATO

CbyC final local file released by the ATO

Jane Rolfe and Aaron Yeo discuss the final Local File High Level Design and compendium released by the ATO for Country-by-Country Reporting.

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The Australian Taxation Office (ATO) intends to release the final Local File High Level Design (HLD) as part of Australia’s implementation of Country-by-Country (CbyC) reporting. The ATO will also release a compendium explaining how it has considered comments received during consultation.

Our observations on the final HLD document include the format, minimising duplication and differences to the OECD Local File.


The ATO has settled on two ‘tiers’ of Local Files – a 'Short Form Local File' for those with sufficiently small and/or low risk international related party dealings (IRPDs) and a 'Local File' for all other impacted taxpayers. The Short Form Local File will require only qualitative information regarding the local entity.

The Local File will require IRPD data that is more granular than the current International Dealings Schedule (IDS) requirements (Part A) as well as written agreements and foreign APAs and rulings for 'material' IRPDs (Part B). The Local File will be in electronic form. 

Minimising duplication

An administrative solution is being developed by the ATO whereby taxpayers may choose to voluntarily lodge Part A of the Local File in place of Section A of the IDS at the time of the tax return, rather than by 12 months after the year end.

Differences to the OECD Local File

Whilst the Organisation for Economic Co-operation and Development (OECD) Local File is much more akin to traditional transfer pricing (TP) documentation, the Australian Local File is more focused on collecting entity and IRPD data in an electronic form from which the ATO can run data analytics to identify TP risk. Existing obligations to self-assess the Australian TP rules as well as the specific Australian TP documentation requirements remain.

The final Local file is available on the ATO website, including instructions to follow. The ATO has confirmed that the Master File will follow the OECD format and will release further information around how the Master File will need to be lodged.

Multinational enterprises will need to pay specific attention to the unique Australian CbyC reporting and TP requirements when implementing their global CbyC reporting strategy.

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