This article was contributed by Yasmeen Suliman and Esther Geldenhuys, Partners, and Marvin Petersen, Senior Associate at Bowmans South Africa.
It examines the South African Revenue Service’s updated implementation timeline for the Global Minimum Tax (Pillar II) regime and its implications for multinational enterprises.
The views expressed in this article are those of the authors and do not necessarily represent the views of Africa Tax Review.
South Africa Extends Global Minimum Tax. The Global Anti-Base Erosion (GloBE) Rules were adopted on 8 October 2021 by over 135 member countries of the so-called Inclusive Framework in co-operation with the Organisation for Economic Co-operation and Development (OECD) and the G20 countries.
It provides for a co-ordinated system of taxation intended to ensure that large multinational enterprise (MNE) groups pay a minimum level of tax (15%) on the income arising in each of the jurisdictions in which they operate.
The GloBE Rules apply to so-called constituent entities (being an entity within an MNE group or a permanent establishment of an entity) that achieved consolidated annual revenue of at least EUR 750 million in at least two of the four fiscal years preceding the tested fiscal year.
With effect from 1 January 2024, South Africa enacted the Global Minimum Tax Act 46 of 2024 (GMT Act), which essentially introduced most of the GloBE Rules into our local tax law, and the Global Minimum Tax Administration Act 47 of 2024 (GMTA Act) to provide for the administration of the GMT Act.
The South African Revenue Service (SARS) has announced a revised timeline for the implementation of the GloBE registration and notification process. The launch of the GloBE functionality on SARS e-Filing is now scheduled for 16 March 2026.
This extension to the deadline which was originally set for December 2025, is attributed to the need for comprehensive technology systems and compliance with evolving international standards.
Key legal provisions under the GMT Act remain in effect. However, in line with the GMTA Act, the due date for the GloBE Information Return (GIR) for fiscal years beginning on or after 1 January 2024 is 18 months after the end of the 2024 fiscal year, and 15 months for subsequent years. Notably, for MNE groups with fiscal years ending before 31 December 2024, the GIR must be submitted by 30 June 2026.
In cases where the MNE group’s fiscal year ended before 31 December 2024 due to a change in the fiscal year because of a takeover by another MNE group, the GIR must be submitted before 30 June 2026.
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Further, in terms of the GMTA Act, domestic constituent entities (DCEs) are required to notify SARS of the so-called designated local entity (DLE) responsible for filing the GIR at least six months prior to the filing deadline, and similar notification requirements apply for the so-called ultimate parent entity or the so-called designated filing entity (DFE). This means that in respect of the 2024 fiscal year the notification has to be filed before 31 December 2025.
As the 31 December 2025 deadline approaches, there has been uncertainty in the market as to how the respective notifications should be filed. Up until earlier this week there was no indication of the process on SARS’ website. SARS has therefore moved the notification deadlines to 30 April 2026 and the GIR submission deadlines to 30 June 2026 for certain MNE groups. These extensions primarily affect the registration and notification process, with the GIR submission extension limited to groups whose fiscal years end before 31 December 2024.
On a positive note, SARS also announced that South Africa has signed the GloBE Information Return Multilateral Competent Authority Agreement (MCAA), facilitating the automatic exchange of GloBE information with other jurisdictions.
Additionally, South Africa has achieved qualified status for its Domestic Minimum Top-Up Tax Rules, which is expected to reduce the risk of double taxation for affected MNE groups.
SARS has committed to issuing further guidance and system readiness updates as the new implementation date approaches. MNE groups are encouraged to continue their internal preparations and monitor forthcoming communications to ensure timely and compliant GloBE filings.
Credit: This article was written by Yasmeen Suliman and Esther Geldenhuys, Partners, and Marvin Petersen, Senior Associate at Bowmans South Africa.
It was shared with Africa Tax Review for publication.
