We help determine your eligibility for ESIC – among the best means of making your business attractive to investment.
Today’s investors truly are spoilt for choice when it comes to spending their savings. Investments littered across different asset classes with different risk profiles and yields abound. Bonds and property traditionally are seen to be the least ‘risky’ whereas more modern investments such as ETFs or cryptocurrencies like Bitcoin carry a higher level of perceived risk. Investments in new startups are often discussed as one of the most risky of all – particularly for third parties without the ‘insider’ level of background information. The Australian government is seeking to reverse this conservative perspective – particularly as it is these same innovative startups that will lead to the industries and jobs of the future.
As part of the ‘ideas boom’ movement, the government has cast a spotlight for savvy investors onto the burgeoning startup scene through the Early Stage Innovation Company (ESIC) tax incentive scheme. The main drawcard for investors involves a ‘tax break’ of 20% equal to the investment made towards a qualifying ESIC share in a startup. This generous concession assists the investor and affiliates to invest up to $1 million whilst making full use of the incentive.
The benefits don’t stop there – startups with ESIC status are also privy to relaxed CGT rules. Investors holding the shares between 12 months and 10 years don’t incur capital gains (or losses) during this time.
Startups wanting to obtain the popular ESIC investment status will find that the criteria is based on a rather significant but slightly versatile 100 points check. Highly favoured criteria includes the eligible expenditure the R&D Tax Incentive, obtaining the Accelerating Commercialisation grant, the receipt of 3rd party investments or participating in an accelerator program.
Fullstack helps startups make a determination on their eligibility for the ESIC status and incorporates the tax break for investors in their tax situation. For a complimentary discussion about the ESIC tax concessions and how they could apply to you contact the Fullstack Advisory team on 1300 887 627 or via email email@example.com.