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.
The tax incentives will 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 10 year exemption on capital gains tax, provided investments are held for three years.
The tax incentives will only be available for investments in companies that:
- Undertake an eligible business (details to be advised).
- 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.
In addition, partners in early stage venture capital funds will also receive a 10% tax offset on the capital invested during the year. The tax concession is limited to funds with assets of less than $200 million.
Further details are available at National Innovation and Science Agenda.