What this addendum covers
The ATO has issued Addendum TD 2022/9A1 to update its ruling TD 2022/9. The original ruling addressed whether section 951A of the US Internal Revenue Code - the provision governing the US 'global intangible low-taxed income' (GILTI) regime - qualifies as a foreign law that corresponds to Australian hybrid mismatch rules under sections 456 or 457 of the Income Tax Assessment Act 1936.
What has changed in the US
The US enacted changes to its GILTI regime under the US One Big Beautiful Bill Act 2025. Under those changes, GILTI has been renamed 'net CFC tested income' (NCTI). Additional structural changes include a reduction in the deduction under section 250 of the US Internal Revenue Code from 50% to 40%, and an increase in the deemed paid credit under section 960(d) from 80% to 90%. These US changes apply for US taxable years beginning after 31 December 2025.
The ATO's position
Despite the renaming and structural changes made by the US One Big Beautiful Bill Act 2025, the ATO's conclusion has not changed. Section 951A of the US Internal Revenue Code still qualifies as a corresponding provision for Australian hybrid mismatch purposes.
When the addendum applies
The addendum applies on and from 1 January 2026, matching the date from which the US changes take effect.
Key actions
- Where a business or related entity is a US shareholder in a controlled foreign corporation (CFC) and applies hybrid mismatch rules under Australian tax law, the consolidated ruling TD 2022/9 is available at the ATO legal database.
- The US One Big Beautiful Bill Act 2025 changes to the GILTI/NCTI regime - including the reduced deduction from 50% to 40% under section 250 and the increased deemed paid credit from 80% to 90% under section 960(d) - apply from US taxable years beginning after 31 December 2025. The ATO addendum itself applies on and from 1 January 2026.
- The ATO legal database holds the consolidated version of TD 2022/9, which incorporates all amendments.
This is a plain-English summary for information only, not legal or compliance advice. Always check the official source or consult a qualified professional.