Tax Planning Strategy 151 | Tax Incentives for Early Stage Investors
Malcolm Turnbull’s Innovation Statement released on 7th December 2015 provides tax incentives for early stage investors. The tax incentives will encourage early stage investment in innovative start-ups and should boost growth by fostering new enterprises and promoting entrepreneurship. Further details are available at National Innovation & Science Agenda.
The tax incentives apply from 1st July 2016 and provides concessional tax treatment for investors, including:
- A 20% non-refundable tax offset on investments, capped at $200,000 per investor per year.
- A capital gains tax exemption provided investments are held for at least one year and less than ten years.
The tax incentives will only be available for investments in companies that:
- Satisfy a 100-point innovation test or are companies that are genuinely focused on developing for commercialisation new or improved products, processes services or methods and can demonstrate that certain requirements in relation to the commercialisation of the innovation are satisfied (for example, that the business related to the innovation has a high growth potential, and the company has the potential to scale its activities to take advantage of the growth potential).
- Were incorporated during the last three income years.
- Are not listed on any stock exchange.
- Have expenditure of less than $1 million in the previous income year.
- Have income of less than $200,000 in the previous income year.
Similar posts you may like
- Tax Savings Strategy 196 | FBT Exempt Work Related Items
Providing the following work related items to employees is tax deductible and FBT exempt: Portable electronic devices such as mobile phones, laptops, tablets, portable Read more
- Tax Savings Strategy 224 | Employee Remuneration Trusts
An Employee Remuneration Trust (ERT) arrangement involves a trust being established to facilitate the provision of payments and/or other benefits to employees of an Read more
- Tax Savings Strategy 204 | Purchase Loss Company
This strategy involves purchasing a loss-making business and taking ownership of the company structure (to access the accumulated tax losses). Clearly this is only Read more
- Tax Planning Strategy 163 | Salary Packaging Business Assets to Double Dip
This tax strategy allows an employee, who is also separately carrying on a business as a sole trader, to claim depreciation on the Read more
"You’d be stupid not to try to cut your tax bill and those that don’t are stupid in business"
- Bono: U2