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Overview of the Early Stage Innovation Company Product Packages

A significant new income stream for accountants/advisors has been created by the Early Stage Innovation Company (ESIC) legislation.

Thousands of companies are expected to attempt to be classified as an ESIC to assist in capital raising.

ESICs are not restrained by S708 of the Corporations Code (restricts capital raising to $2M from up to 20 investors each 12 months) and investors can be eligible for a significant bonus:

  • 20% tax offset on the investment in year year of investment;
    • sophisticated investors maximum tax offset of $200,000 ($1M maximum investment);
    • retail investors maximum tax offset $10,000 ($50,000 maximum investment; and
  • a capital gains tax exemption on the investment for more than one year to less than 10 years.