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Stephen Crowe answers
your common ESIC questions

Early Stage Company

No. Being ESIC ready is open to all innovators, business creators and those looking to grow their existing business, not just your neighbour who spends each week dreaming up the next big game changer and telling you about its high growth potential.

An existing company selling products and/or services to customers, earning an income and even making a profit can qualify as an ESIC.

It is essential an Early Stage Innovation Company (“ESIC”) meets eligibility criteria under Australian tax laws. A company that satisfies the early-stage test and either the 100-point innovation test or principles based test will qualify as an ESIC.

The concept of investment risk is not used to qualify an ESIC.

ESIC benefits can flow to those who have spent time building a business from scratch, testing it in the market, saving costs wherever they can and eking out a living. ESIC benefits are open to all sectors of the economy, not only those with high-growth potential.  

Connect with ESIC Hub to access the ESIC benefits.

Accelerator programs are designed to boost Australia’s innovation performance and create connections between research, science and business.

The ESIC investment framework introduced as part of the government’s National Innovation and Science Agenda (“NISA”) strengthens the connection with accelerator programs and benefits those who dare to imagine, collaborate and innovate with Accelerator programs.

If the company has completed or is undertaking an eligible Accelerator program it will obtain 50 points, be half-way towards meeting the 100 point innovation test and one step closer to being ESIC Ready.

If you haven’t already completed our free online ESIC Predictor, now is a good time to discover your ESIC Status.

No. In making your decision about accelerator programs and which is appropriate, the ESIC tax rules only recognize a program that:

  • Provides time-limited support for entrepreneurs with start-up businesses;
  • Has a selection program that is open, independent and competitive;
  • Has a demonstrated track record of providing accelerator programs for entrepreneurs for at least 6 months; and
  • Has been completed by at least one cohort of entrepreneurs.

Participation in an eligible accelerator program offers the bonus of contributing 50 points towards the 100-point innovation test.

Accelerator programs are recognised in the government’s National Innovation and Science Agenda (“NISA”) and play an important role in boosting Australia’s innovation performance and creating collaborative relationships between research, science and business.

They offer you access to skills, experiences and credibility often not attainable elsewhere on commercial terms reflecting your early-stage financial circumstances.

ESIC Hub advocates for all accelerator programs and acknowledge their significant contribution to the early-stage community.  If you have capital raising plans and aspirations, consider whether your chosen accelerator assists in contributing points towards achieving ESIC ready status. Ask ESIC Hub.

Being an ESIC unlocks new avenues to capital and accelerates your new funding. From 1 July 2016 being an ESIC is important because investors in your early stage company will receive government mandated tax incentives to invest new equity capital into your venture. This broadens your investor community beyond the angel and venture capital investors traditionally reserved for the privileged few. Your family, friends, employees and suppliers who invest in your early stage company can also obtain the tax incentives if your company qualifies as an ESIC.

You need to qualify as an ESIC. An ESIC is a dynamic and progressive status. A clean canvas is often a good starting point because this allows us to advise you on the best route to operating in this new ESIC environment. We have the knowledge, resources and experience to take you from start to finish.

Being an ESIC is very achievable but doesn’t come easy, and if your ESIC plan is not implemented correctly, the negative outcomes are long-term and irreversible. This serves as a friendly reminder we are working within the confines of Australia’s tax laws… sorry

This is not uncommon in the early-stage community. The laws impose an obligation to assess your ESIC status at the time new shares are issued. Sadly, shares issued without an ESIC certification at the time of investment will most likely not qualify. However, for those who act quickly we may be able to assist in this tricky situation so please contact us.

Although the ESIC environment is new, its implications cannot be ignored. If your early-stage company raises capital from 1 July 2016 and becomes wildly successful, it would be natural to feel this is a great mutual outcome for you and your investors, right? Unfortunately, no.

Whilst you are still celebrating your monumental success, your investors’ legal team are busily drafting a series of legal proceedings seeking recovery from you for unexpected capital gains tax. Surprise.

If you do not properly navigate this new ESIC environment, you will be vulnerable to litigation and financial losses.

Work with us and our experienced and friendly team will eliminate these risks and provide a secure, regulated and independent environment for your startup.

No, in fact, it could be quite the opposite.

The 100-point innovation test is a cumulative points system, and you do not need to satisfy all of those criteria. For example, we have clients who are ESIC ready after meeting only 2 of the criteria.

You can also qualify as an ESIC by meeting the principles based test.

Spend 5 minutes using our free online ESIC Predictor let us calculate your 100-points entitlement and you will immediately see your self-assessed ESIC status.

Even if you are not currently an ESIC, this does not disqualify you from being an ESIC in the future. Your circumstances may change as early as tomorrow and we recommend you stay connected with ESIC Hub. Re-evaluate your ESIC status using the ESIC Predictor as often as needed, it’s free or just contact us.

Yes/No/Maybe/Depends.

Just another friendly reminder this answer is dictated by Australia’s tax laws, sorry. In the ESIC environment, your status is dynamic and is affected by a multitude of factors that can change daily in a business environment.

Each and every time you are planning to raise capital you will need to ascertain your current ESIC status, which may be different from the previous time and that may be good news for some and a surprise to others.

In the course of your business lifecycle, you may find yourself being ESIC qualified on 1 occasion or 1000 occasions.

Spend 5 minutes using our free online ESIC Predictor let us calculate your 100-points entitlement and you will immediately see your self-assessed ESIC status. A friendly reminder to use this function as often as you need to re-evaluate and to stay connected with the ESIC Hub team.

No. It is essential an Early Stage Innovation Company (“ESIC”) meets eligibility criteria under Australia’s income tax laws. A company that satisfies the early-stage test and either the 100-point innovation test or principles based test will qualify as an ESIC. The concept of investment risk is not used to qualify an ESIC.

An existing company selling products and/or services to customers, earning an income and even making a profit can qualify as an ESIC.

Being ESIC ready is open to all innovators, business creators and those looking to grow their existing business, not just your neighbour who spends each week dreaming up the next big game changer and telling you about its high growth potential.

ESIC benefits can flow to those who have spent time building a business from scratch, testing it in the market, saving costs wherever they can and eking out a living. ESIC benefits are open to all sectors of the economy, not only those with high-growth potential.

Ask ESIC Hub how to access the ESIC benefits.

Early Stage Company

No. Being ESIC ready is open to all innovators, business creators and those looking to grow their existing business, not just your neighbour who spends each week dreaming up the next big game changer and telling you about its high growth potential.

An existing company selling products and/or services to customers, earning an income and even making a profit can qualify as an ESIC.

It is essential an Early Stage Innovation Company (“ESIC”) meets eligibility criteria under Australian tax laws. A company that satisfies the early-stage test and either the 100-point innovation test or principles based test will qualify as an ESIC.

The concept of investment risk is not used to qualify an ESIC.

ESIC benefits can flow to those who have spent time building a business from scratch, testing it in the market, saving costs wherever they can and eking out a living. ESIC benefits are open to all sectors of the economy, not only those with high-growth potential.  

Connect with ESIC Hub to access the ESIC benefits.

Accelerator programs are designed to boost Australia’s innovation performance and create connections between research, science and business.

The ESIC investment framework introduced as part of the government’s National Innovation and Science Agenda (“NISA”) strengthens the connection with accelerator programs and benefits those who dare to imagine, collaborate and innovate with Accelerator programs.

If the company has completed or is undertaking an eligible Accelerator program it will obtain 50 points, be half-way towards meeting the 100 point innovation test and one step closer to being ESIC Ready.

If you haven’t already completed our free online ESIC Predictor, now is a good time to discover your ESIC Status.

No. In making your decision about accelerator programs and which is appropriate, the ESIC tax rules only recognize a program that:

  • Provides time-limited support for entrepreneurs with start-up businesses;
  • Has a selection program that is open, independent and competitive;
  • Has a demonstrated track record of providing accelerator programs for entrepreneurs for at least 6 months; and
  • Has been completed by at least one cohort of entrepreneurs.

Participation in an eligible accelerator program offers the bonus of contributing 50 points towards the 100-point innovation test.

Accelerator programs are recognised in the government’s National Innovation and Science Agenda (“NISA”) and play an important role in boosting Australia’s innovation performance and creating collaborative relationships between research, science and business.

They offer you access to skills, experiences and credibility often not attainable elsewhere on commercial terms reflecting your early-stage financial circumstances.

ESIC Hub advocates for all accelerator programs and acknowledge their significant contribution to the early-stage community.  If you have capital raising plans and aspirations, consider whether your chosen accelerator assists in contributing points towards achieving ESIC ready status. Ask ESIC Hub.

Being an ESIC unlocks new avenues to capital and accelerates your new funding. From 1 July 2016 being an ESIC is important because investors in your early stage company will receive government mandated tax incentives to invest new equity capital into your venture. This broadens your investor community beyond the angel and venture capital investors traditionally reserved for the privileged few. Your family, friends, employees and suppliers who invest in your early stage company can also obtain the tax incentives if your company qualifies as an ESIC.

You need to qualify as an ESIC. An ESIC is a dynamic and progressive status. A clean canvas is often a good starting point because this allows us to advise you on the best route to operating in this new ESIC environment. We have the knowledge, resources and experience to take you from start to finish.

Being an ESIC is very achievable but doesn’t come easy, and if your ESIC plan is not implemented correctly, the negative outcomes are long-term and irreversible. This serves as a friendly reminder we are working within the confines of Australia’s tax laws… sorry

This is not uncommon in the early-stage community. The laws impose an obligation to assess your ESIC status at the time new shares are issued. Sadly, shares issued without an ESIC certification at the time of investment will most likely not qualify. However, for those who act quickly we may be able to assist in this tricky situation so please contact us.

Although the ESIC environment is new, its implications cannot be ignored. If your early-stage company raises capital from 1 July 2016 and becomes wildly successful, it would be natural to feel this is a great mutual outcome for you and your investors, right? Unfortunately, no.

Whilst you are still celebrating your monumental success, your investors’ legal team are busily drafting a series of legal proceedings seeking recovery from you for unexpected capital gains tax. Surprise.

If you do not properly navigate this new ESIC environment, you will be vulnerable to litigation and financial losses.

Work with us and our experienced and friendly team will eliminate these risks and provide a secure, regulated and independent environment for your startup.

No, in fact, it could be quite the opposite.

The 100-point innovation test is a cumulative points system, and you do not need to satisfy all of those criteria. For example, we have clients who are ESIC ready after meeting only 2 of the criteria.

You can also qualify as an ESIC by meeting the principles based test.

Spend 5 minutes using our free online ESIC Predictor let us calculate your 100-points entitlement and you will immediately see your self-assessed ESIC status.

Even if you are not currently an ESIC, this does not disqualify you from being an ESIC in the future. Your circumstances may change as early as tomorrow and we recommend you stay connected with ESIC Hub. Re-evaluate your ESIC status using the ESIC Predictor as often as needed, it’s free or just contact us.

Yes/No/Maybe/Depends.

Just another friendly reminder this answer is dictated by Australia’s tax laws, sorry. In the ESIC environment, your status is dynamic and is affected by a multitude of factors that can change daily in a business environment.

Each and every time you are planning to raise capital you will need to ascertain your current ESIC status, which may be different from the previous time and that may be good news for some and a surprise to others.

In the course of your business lifecycle, you may find yourself being ESIC qualified on 1 occasion or 1000 occasions.

Spend 5 minutes using our free online ESIC Predictor let us calculate your 100-points entitlement and you will immediately see your self-assessed ESIC status. A friendly reminder to use this function as often as you need to re-evaluate and to stay connected with the ESIC Hub team.

No. It is essential an Early Stage Innovation Company (“ESIC”) meets eligibility criteria under Australia’s income tax laws. A company that satisfies the early-stage test and either the 100-point innovation test or principles based test will qualify as an ESIC. The concept of investment risk is not used to qualify an ESIC.

An existing company selling products and/or services to customers, earning an income and even making a profit can qualify as an ESIC.

Being ESIC ready is open to all innovators, business creators and those looking to grow their existing business, not just your neighbour who spends each week dreaming up the next big game changer and telling you about its high growth potential.

ESIC benefits can flow to those who have spent time building a business from scratch, testing it in the market, saving costs wherever they can and eking out a living. ESIC benefits are open to all sectors of the economy, not only those with high-growth potential.

Ask ESIC Hub how to access the ESIC benefits.

General ESIC Questions

Early Stage Company

Early Stage Company

No. Being ESIC ready is open to all innovators, business creators and those looking to grow their existing business, not just your neighbour who spends each week dreaming up the next big game changer and telling you about its high growth potential.

An existing company selling products and/or services to customers, earning an income and even making a profit can qualify as an ESIC.

It is essential an Early Stage Innovation Company (“ESIC”) meets eligibility criteria under Australian tax laws. A company that satisfies the early-stage test and either the 100-point innovation test or principles based test will qualify as an ESIC.

The concept of investment risk is not used to qualify an ESIC.

ESIC benefits can flow to those who have spent time building a business from scratch, testing it in the market, saving costs wherever they can and eking out a living. ESIC benefits are open to all sectors of the economy, not only those with high-growth potential.  

Connect with ESIC Hub to access the ESIC benefits.

Accelerator programs are designed to boost Australia’s innovation performance and create connections between research, science and business.

The ESIC investment framework introduced as part of the government’s National Innovation and Science Agenda (“NISA”) strengthens the connection with accelerator programs and benefits those who dare to imagine, collaborate and innovate with Accelerator programs.

If the company has completed or is undertaking an eligible Accelerator program it will obtain 50 points, be half-way towards meeting the 100 point innovation test and one step closer to being ESIC Ready.

If you haven’t already completed our free online ESIC Predictor, now is a good time to discover your ESIC Status.

No. In making your decision about accelerator programs and which is appropriate, the ESIC tax rules only recognize a program that:

  • Provides time-limited support for entrepreneurs with start-up businesses;
  • Has a selection program that is open, independent and competitive;
  • Has a demonstrated track record of providing accelerator programs for entrepreneurs for at least 6 months; and
  • Has been completed by at least one cohort of entrepreneurs.

Participation in an eligible accelerator program offers the bonus of contributing 50 points towards the 100-point innovation test.

Accelerator programs are recognised in the government’s National Innovation and Science Agenda (“NISA”) and play an important role in boosting Australia’s innovation performance and creating collaborative relationships between research, science and business.

They offer you access to skills, experiences and credibility often not attainable elsewhere on commercial terms reflecting your early-stage financial circumstances.

ESIC Hub advocates for all accelerator programs and acknowledge their significant contribution to the early-stage community.  If you have capital raising plans and aspirations, consider whether your chosen accelerator assists in contributing points towards achieving ESIC ready status. Ask ESIC Hub.

Being an ESIC unlocks new avenues to capital and accelerates your new funding. From 1 July 2016 being an ESIC is important because investors in your early stage company will receive government mandated tax incentives to invest new equity capital into your venture. This broadens your investor community beyond the angel and venture capital investors traditionally reserved for the privileged few. Your family, friends, employees and suppliers who invest in your early stage company can also obtain the tax incentives if your company qualifies as an ESIC.

You need to qualify as an ESIC. An ESIC is a dynamic and progressive status. A clean canvas is often a good starting point because this allows us to advise you on the best route to operating in this new ESIC environment. We have the knowledge, resources and experience to take you from start to finish.

Being an ESIC is very achievable but doesn’t come easy, and if your ESIC plan is not implemented correctly, the negative outcomes are long-term and irreversible. This serves as a friendly reminder we are working within the confines of Australia’s tax laws… sorry

This is not uncommon in the early-stage community. The laws impose an obligation to assess your ESIC status at the time new shares are issued. Sadly, shares issued without an ESIC certification at the time of investment will most likely not qualify. However, for those who act quickly we may be able to assist in this tricky situation so please contact us.

Although the ESIC environment is new, its implications cannot be ignored. If your early-stage company raises capital from 1 July 2016 and becomes wildly successful, it would be natural to feel this is a great mutual outcome for you and your investors, right? Unfortunately, no.

Whilst you are still celebrating your monumental success, your investors’ legal team are busily drafting a series of legal proceedings seeking recovery from you for unexpected capital gains tax. Surprise.

If you do not properly navigate this new ESIC environment, you will be vulnerable to litigation and financial losses.

Work with us and our experienced and friendly team will eliminate these risks and provide a secure, regulated and independent environment for your startup.

No, in fact, it could be quite the opposite.

The 100-point innovation test is a cumulative points system, and you do not need to satisfy all of those criteria. For example, we have clients who are ESIC ready after meeting only 2 of the criteria.

You can also qualify as an ESIC by meeting the principles based test.

Spend 5 minutes using our free online ESIC Predictor let us calculate your 100-points entitlement and you will immediately see your self-assessed ESIC status.

Even if you are not currently an ESIC, this does not disqualify you from being an ESIC in the future. Your circumstances may change as early as tomorrow and we recommend you stay connected with ESIC Hub. Re-evaluate your ESIC status using the ESIC Predictor as often as needed, it’s free or just contact us.

Yes/No/Maybe/Depends.

Just another friendly reminder this answer is dictated by Australia’s tax laws, sorry. In the ESIC environment, your status is dynamic and is affected by a multitude of factors that can change daily in a business environment.

Each and every time you are planning to raise capital you will need to ascertain your current ESIC status, which may be different from the previous time and that may be good news for some and a surprise to others.

In the course of your business lifecycle, you may find yourself being ESIC qualified on 1 occasion or 1000 occasions.

Spend 5 minutes using our free online ESIC Predictor let us calculate your 100-points entitlement and you will immediately see your self-assessed ESIC status. A friendly reminder to use this function as often as you need to re-evaluate and to stay connected with the ESIC Hub team.

No. It is essential an Early Stage Innovation Company (“ESIC”) meets eligibility criteria under Australia’s income tax laws. A company that satisfies the early-stage test and either the 100-point innovation test or principles based test will qualify as an ESIC. The concept of investment risk is not used to qualify an ESIC.

An existing company selling products and/or services to customers, earning an income and even making a profit can qualify as an ESIC.

Being ESIC ready is open to all innovators, business creators and those looking to grow their existing business, not just your neighbour who spends each week dreaming up the next big game changer and telling you about its high growth potential.

ESIC benefits can flow to those who have spent time building a business from scratch, testing it in the market, saving costs wherever they can and eking out a living. ESIC benefits are open to all sectors of the economy, not only those with high-growth potential.

Ask ESIC Hub how to access the ESIC benefits.

Early Stage Investor

Early Stage Company

No. Being ESIC ready is open to all innovators, business creators and those looking to grow their existing business, not just your neighbour who spends each week dreaming up the next big game changer and telling you about its high growth potential.

An existing company selling products and/or services to customers, earning an income and even making a profit can qualify as an ESIC.

It is essential an Early Stage Innovation Company (“ESIC”) meets eligibility criteria under Australian tax laws. A company that satisfies the early-stage test and either the 100-point innovation test or principles based test will qualify as an ESIC.

The concept of investment risk is not used to qualify an ESIC.

ESIC benefits can flow to those who have spent time building a business from scratch, testing it in the market, saving costs wherever they can and eking out a living. ESIC benefits are open to all sectors of the economy, not only those with high-growth potential.  

Connect with ESIC Hub to access the ESIC benefits.

Accelerator programs are designed to boost Australia’s innovation performance and create connections between research, science and business.

The ESIC investment framework introduced as part of the government’s National Innovation and Science Agenda (“NISA”) strengthens the connection with accelerator programs and benefits those who dare to imagine, collaborate and innovate with Accelerator programs.

If the company has completed or is undertaking an eligible Accelerator program it will obtain 50 points, be half-way towards meeting the 100 point innovation test and one step closer to being ESIC Ready.

If you haven’t already completed our free online ESIC Predictor, now is a good time to discover your ESIC Status.

No. In making your decision about accelerator programs and which is appropriate, the ESIC tax rules only recognize a program that:

  • Provides time-limited support for entrepreneurs with start-up businesses;
  • Has a selection program that is open, independent and competitive;
  • Has a demonstrated track record of providing accelerator programs for entrepreneurs for at least 6 months; and
  • Has been completed by at least one cohort of entrepreneurs.

Participation in an eligible accelerator program offers the bonus of contributing 50 points towards the 100-point innovation test.

Accelerator programs are recognised in the government’s National Innovation and Science Agenda (“NISA”) and play an important role in boosting Australia’s innovation performance and creating collaborative relationships between research, science and business.

They offer you access to skills, experiences and credibility often not attainable elsewhere on commercial terms reflecting your early-stage financial circumstances.

ESIC Hub advocates for all accelerator programs and acknowledge their significant contribution to the early-stage community.  If you have capital raising plans and aspirations, consider whether your chosen accelerator assists in contributing points towards achieving ESIC ready status. Ask ESIC Hub.

Being an ESIC unlocks new avenues to capital and accelerates your new funding. From 1 July 2016 being an ESIC is important because investors in your early stage company will receive government mandated tax incentives to invest new equity capital into your venture. This broadens your investor community beyond the angel and venture capital investors traditionally reserved for the privileged few. Your family, friends, employees and suppliers who invest in your early stage company can also obtain the tax incentives if your company qualifies as an ESIC.

You need to qualify as an ESIC. An ESIC is a dynamic and progressive status. A clean canvas is often a good starting point because this allows us to advise you on the best route to operating in this new ESIC environment. We have the knowledge, resources and experience to take you from start to finish.

Being an ESIC is very achievable but doesn’t come easy, and if your ESIC plan is not implemented correctly, the negative outcomes are long-term and irreversible. This serves as a friendly reminder we are working within the confines of Australia’s tax laws… sorry

This is not uncommon in the early-stage community. The laws impose an obligation to assess your ESIC status at the time new shares are issued. Sadly, shares issued without an ESIC certification at the time of investment will most likely not qualify. However, for those who act quickly we may be able to assist in this tricky situation so please contact us.

Although the ESIC environment is new, its implications cannot be ignored. If your early-stage company raises capital from 1 July 2016 and becomes wildly successful, it would be natural to feel this is a great mutual outcome for you and your investors, right? Unfortunately, no.

Whilst you are still celebrating your monumental success, your investors’ legal team are busily drafting a series of legal proceedings seeking recovery from you for unexpected capital gains tax. Surprise.

If you do not properly navigate this new ESIC environment, you will be vulnerable to litigation and financial losses.

Work with us and our experienced and friendly team will eliminate these risks and provide a secure, regulated and independent environment for your startup.

No, in fact, it could be quite the opposite.

The 100-point innovation test is a cumulative points system, and you do not need to satisfy all of those criteria. For example, we have clients who are ESIC ready after meeting only 2 of the criteria.

You can also qualify as an ESIC by meeting the principles based test.

Spend 5 minutes using our free online ESIC Predictor let us calculate your 100-points entitlement and you will immediately see your self-assessed ESIC status.

Even if you are not currently an ESIC, this does not disqualify you from being an ESIC in the future. Your circumstances may change as early as tomorrow and we recommend you stay connected with ESIC Hub. Re-evaluate your ESIC status using the ESIC Predictor as often as needed, it’s free or just contact us.

Yes/No/Maybe/Depends.

Just another friendly reminder this answer is dictated by Australia’s tax laws, sorry. In the ESIC environment, your status is dynamic and is affected by a multitude of factors that can change daily in a business environment.

Each and every time you are planning to raise capital you will need to ascertain your current ESIC status, which may be different from the previous time and that may be good news for some and a surprise to others.

In the course of your business lifecycle, you may find yourself being ESIC qualified on 1 occasion or 1000 occasions.

Spend 5 minutes using our free online ESIC Predictor let us calculate your 100-points entitlement and you will immediately see your self-assessed ESIC status. A friendly reminder to use this function as often as you need to re-evaluate and to stay connected with the ESIC Hub team.

No. It is essential an Early Stage Innovation Company (“ESIC”) meets eligibility criteria under Australia’s income tax laws. A company that satisfies the early-stage test and either the 100-point innovation test or principles based test will qualify as an ESIC. The concept of investment risk is not used to qualify an ESIC.

An existing company selling products and/or services to customers, earning an income and even making a profit can qualify as an ESIC.

Being ESIC ready is open to all innovators, business creators and those looking to grow their existing business, not just your neighbour who spends each week dreaming up the next big game changer and telling you about its high growth potential.

ESIC benefits can flow to those who have spent time building a business from scratch, testing it in the market, saving costs wherever they can and eking out a living. ESIC benefits are open to all sectors of the economy, not only those with high-growth potential.

Ask ESIC Hub how to access the ESIC benefits.

Adviser

Early Stage Company

No. Being ESIC ready is open to all innovators, business creators and those looking to grow their existing business, not just your neighbour who spends each week dreaming up the next big game changer and telling you about its high growth potential.

An existing company selling products and/or services to customers, earning an income and even making a profit can qualify as an ESIC.

It is essential an Early Stage Innovation Company (“ESIC”) meets eligibility criteria under Australian tax laws. A company that satisfies the early-stage test and either the 100-point innovation test or principles based test will qualify as an ESIC.

The concept of investment risk is not used to qualify an ESIC.

ESIC benefits can flow to those who have spent time building a business from scratch, testing it in the market, saving costs wherever they can and eking out a living. ESIC benefits are open to all sectors of the economy, not only those with high-growth potential.  

Connect with ESIC Hub to access the ESIC benefits.

Accelerator programs are designed to boost Australia’s innovation performance and create connections between research, science and business.

The ESIC investment framework introduced as part of the government’s National Innovation and Science Agenda (“NISA”) strengthens the connection with accelerator programs and benefits those who dare to imagine, collaborate and innovate with Accelerator programs.

If the company has completed or is undertaking an eligible Accelerator program it will obtain 50 points, be half-way towards meeting the 100 point innovation test and one step closer to being ESIC Ready.

If you haven’t already completed our free online ESIC Predictor, now is a good time to discover your ESIC Status.

No. In making your decision about accelerator programs and which is appropriate, the ESIC tax rules only recognize a program that:

  • Provides time-limited support for entrepreneurs with start-up businesses;
  • Has a selection program that is open, independent and competitive;
  • Has a demonstrated track record of providing accelerator programs for entrepreneurs for at least 6 months; and
  • Has been completed by at least one cohort of entrepreneurs.

Participation in an eligible accelerator program offers the bonus of contributing 50 points towards the 100-point innovation test.

Accelerator programs are recognised in the government’s National Innovation and Science Agenda (“NISA”) and play an important role in boosting Australia’s innovation performance and creating collaborative relationships between research, science and business.

They offer you access to skills, experiences and credibility often not attainable elsewhere on commercial terms reflecting your early-stage financial circumstances.

ESIC Hub advocates for all accelerator programs and acknowledge their significant contribution to the early-stage community.  If you have capital raising plans and aspirations, consider whether your chosen accelerator assists in contributing points towards achieving ESIC ready status. Ask ESIC Hub.

Being an ESIC unlocks new avenues to capital and accelerates your new funding. From 1 July 2016 being an ESIC is important because investors in your early stage company will receive government mandated tax incentives to invest new equity capital into your venture. This broadens your investor community beyond the angel and venture capital investors traditionally reserved for the privileged few. Your family, friends, employees and suppliers who invest in your early stage company can also obtain the tax incentives if your company qualifies as an ESIC.

You need to qualify as an ESIC. An ESIC is a dynamic and progressive status. A clean canvas is often a good starting point because this allows us to advise you on the best route to operating in this new ESIC environment. We have the knowledge, resources and experience to take you from start to finish.

Being an ESIC is very achievable but doesn’t come easy, and if your ESIC plan is not implemented correctly, the negative outcomes are long-term and irreversible. This serves as a friendly reminder we are working within the confines of Australia’s tax laws… sorry

This is not uncommon in the early-stage community. The laws impose an obligation to assess your ESIC status at the time new shares are issued. Sadly, shares issued without an ESIC certification at the time of investment will most likely not qualify. However, for those who act quickly we may be able to assist in this tricky situation so please contact us.

Although the ESIC environment is new, its implications cannot be ignored. If your early-stage company raises capital from 1 July 2016 and becomes wildly successful, it would be natural to feel this is a great mutual outcome for you and your investors, right? Unfortunately, no.

Whilst you are still celebrating your monumental success, your investors’ legal team are busily drafting a series of legal proceedings seeking recovery from you for unexpected capital gains tax. Surprise.

If you do not properly navigate this new ESIC environment, you will be vulnerable to litigation and financial losses.

Work with us and our experienced and friendly team will eliminate these risks and provide a secure, regulated and independent environment for your startup.

No, in fact, it could be quite the opposite.

The 100-point innovation test is a cumulative points system, and you do not need to satisfy all of those criteria. For example, we have clients who are ESIC ready after meeting only 2 of the criteria.

You can also qualify as an ESIC by meeting the principles based test.

Spend 5 minutes using our free online ESIC Predictor let us calculate your 100-points entitlement and you will immediately see your self-assessed ESIC status.

Even if you are not currently an ESIC, this does not disqualify you from being an ESIC in the future. Your circumstances may change as early as tomorrow and we recommend you stay connected with ESIC Hub. Re-evaluate your ESIC status using the ESIC Predictor as often as needed, it’s free or just contact us.

Yes/No/Maybe/Depends.

Just another friendly reminder this answer is dictated by Australia’s tax laws, sorry. In the ESIC environment, your status is dynamic and is affected by a multitude of factors that can change daily in a business environment.

Each and every time you are planning to raise capital you will need to ascertain your current ESIC status, which may be different from the previous time and that may be good news for some and a surprise to others.

In the course of your business lifecycle, you may find yourself being ESIC qualified on 1 occasion or 1000 occasions.

Spend 5 minutes using our free online ESIC Predictor let us calculate your 100-points entitlement and you will immediately see your self-assessed ESIC status. A friendly reminder to use this function as often as you need to re-evaluate and to stay connected with the ESIC Hub team.

No. It is essential an Early Stage Innovation Company (“ESIC”) meets eligibility criteria under Australia’s income tax laws. A company that satisfies the early-stage test and either the 100-point innovation test or principles based test will qualify as an ESIC. The concept of investment risk is not used to qualify an ESIC.

An existing company selling products and/or services to customers, earning an income and even making a profit can qualify as an ESIC.

Being ESIC ready is open to all innovators, business creators and those looking to grow their existing business, not just your neighbour who spends each week dreaming up the next big game changer and telling you about its high growth potential.

ESIC benefits can flow to those who have spent time building a business from scratch, testing it in the market, saving costs wherever they can and eking out a living. ESIC benefits are open to all sectors of the economy, not only those with high-growth potential.

Ask ESIC Hub how to access the ESIC benefits.