Early stage innovation companies - A deeper dive
Source: Taxation In Australia Journal Article
Published Date: 1 Mar 2017
As part of the National Innovation and Science Agenda, the government has been working to encourage innovation by ensuring that tax incentives are available for early stage investors in qualifying early stage innovation companies (ESICs) " typically, start-up companies with high growth potential. In May 2016, the Tax Laws Amendment (Tax Incentives for Innovation) Bill 2016 was passed to incentivise investors to direct funds towards ESICs through the provision of tax concessions, provided the ESIC satisfies both the early stage limb and the innovation limb " the latter of which can be satisfied by passing the principles-based test or the 100 points test. This article examines the new legislation and concludes that, despite the ambiguity surrounding the principles-based test and the lack of available guidance regarding the incentives generally, the ESIC tax concessions are a welcome initiative by the government and the uncertainty regarding these provisions can be resolved through further ATO guidance.
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Details
- Published By: Mark Trewhella ATI, Jessica Brass
- Published On:1 Mar 2017
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