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Don’t forget, investors receive a taxation benefit!

Towers Business Development News

Investors can enjoy an enticing 'Taxation Benefit' when contributing capital to a company striving to attain ‘Early Stage Innovation Company Status’. This benefit not only proves attractive for investors but also provides the company with crucial funds that might not have been secured without the government's incentivised process.

Investors can qualify for two (2) separate tax incentives:

  1. Taxation Offset calculated at 20% of the investment with a maximum offset available for a Sophisticated Investor of $200,000 and a Retail Investor of $10,000.
  1. If the Investor, now Shareholder, retains the shares that were allocated as part of the Early-Stage Innovation Company status process for more than 12 months and less than 10 years, the Shareholder will be able to disregard any capital gain in relation to the shares that were allocated as part of the Early Stage Innovation Company Status Process.

This legislation was a key initiative of the Government, to encourage investors to have a serious look at ‘Young Innovative Companies’ that were seeking financial support.

Companies wishing to discuss investment with Investors will need…

Business Plans outlining the company’s vision.

Predictive Accounting Reports – budgets, cash flow forecast, projected balance sheets.

Share Price Calculation Summary.

Documentation relative to the Early Stage Innovation Company status. If the company has completed the Principles Test, the documentation needs to be lodged with the ATO for approval. And if the company was self-assessed under the Gateway Test, the documentation is required to be retained to satisfy any subsequent audit.

Most companies will require assistance in this process. To find out how Towers Business Development could assist your company, contact us on 1800 232 088 or email .

Don’t forget, investors receive a taxation benefit!