Early-Stage Innovation Company status only available for established companies?
Business Advisory Services Update
This is a MYTH!
The ‘Early-Stage Innovation Company Status’ was created by amendments to the Income Tax Act, to enable small, young companies that have been undertaking ‘innovative activities’, to be able to raise capital from investors, with the legislation including ‘carrots’ to encourage investors to invest in small, young companies that have been undertaking innovative activities.
The ‘Early-Stage Innovation Company Status Amendments’ are clearly targeted at SMEs: the key group of clients for the majority of small and medium-sized Accountancy/Bookkeeping firms.
Companies which have been incorporated under section 708 of the Corporations Act and who have undertaken innovative activities can be eligible.
The first test is the ‘Test Time Determinations’. Three (3) components of companies can apply. These three components are…
Company under three (3) years of age: expenses of less than $1M in the income year before the current year. Assessable income of less than $200,000 (excluding any grant funds from the Accelerating Commercialisation Grant) in the income year before the current year. Not listed on a stock exchange anywhere in the world.
Company under six (6) years of age: across the last three of those income years incurred total expenses of $1M or less. Total assessable income of less than $200,000, (excluding any grant funds from the Accelerating Commercialisation Grant) in the income year before the current year. Not listed on a stock exchange anywhere in the world.
Company registered on Australian Business Register in the last three (3) years: expenses of less than $1M in the income year before the current year. Total assessable income of less than $200,000 (excluding any grant funds from the Accelerating Commercialisation Grant) in the income year before the current year. Not listed on a stock exchange anywhere in the world.
ESS BIZTOOLS has developed Early Stage Innovation Company Product Package, to assist Accountants/Bookkeepers to offer these services to SMEs. To find out more, contact us on 1800 232 088 or email .
