50% via Gateway Test?

A small company could obtain the 50% contribution that it would need to access the ‘Early-Stage Commercialisation’ grant available from the ‘Industry Growth Program’, if the company qualified for the ‘Early-Stage Innovation Company’ status.

If the company is under six years of age and has basically been involved in R&D activities – with turnover under $200,000 and expenditure under $1million – the company may be able to qualify if it can accumulate 100 points under the ‘Gateway Test’.

If the company is able to produce the documentation to prove that it has a score of 100 points or more, it will be deemed to have self-assessed to be classified as an Early-Stage Innovation Company. This gives the company an edge when negotiating with potential investors because the investors receive 20% of their investment up to $200,000 for a sophisticated investor, and up to $10,000 for a retail investor as a taxation credit, and the possibility of being able to avoid Capital Gains Tax.

Points can be earned if:

• 50% of the company’s expenditure has been spent on R&D: 75 points

• 15% up to 49.9% of the company’s expenditure has been spent on R&D: 50 points

• Admitted to the Accelerating Commercialisation Program: 75 points

• Admitted to the Accelerator Program: 50 points

• Raised at least $50,000 from arm’s-length investors: 50 points

• Has a patent or a standard patent or plant breeder’s right: 50 points

• Has a registered design: 25 points

• Written agreement with an education funding organisation: 25 points

If the total score is 100 points, it has self-assessed as an ‘Early-Stage Innovation Company’, and can finalise negotiations with investors who will be able to apply for the special benefits in their subsequent taxation returns.

If you are interested in having a discussion about how your company could qualify for the status of an ‘Early-Stage Innovation Company’, contact Towers Business Development on 1800 232 088 or email .