Sep 21, 2016
The Early Stage Innovation Company legislation offers significant taxation benefits to eligible investors. To make Early Stage Innovation Companies work there has to be investors. Investors can qualify for two major tax incentives:
1. the 20% tax offset - which is available for sophisticated
investors - up to $200,000 and for retail investors up to $10,000;
2. the capital gains tax exemption - which is available to investors from the end of the first twelve months of their investment to the end of nine years.
Sophisticated investors are people who have had their accountant prepare a statement to the effect that their net worth is over $2.5M and their assessable income for the last two years has exceeded $250,000.
For companies to qualify as an ESIC they need to have passed two out of three tests.