Small and Medium businesses (SME’s) can access literally hundreds of government grants that are offered by the Australian, State and Territory governments throughout the year. Some of the common types of grants for businesses include:
Research and Development
The applicant must be a company, have undertaken a documented research and development project and complied with record keeping and reporting requirements.
For companies with annual turnovers under $20M:
If the company is trading at a loss, the directors can elect to receive a cash refund from the Australian Taxation Office being the value of the Research & Development Tax Incentive Rebate, subject to the company’s tax losses exceeding the rebate amount. This refund is normally paid within 30 days of the company lodging its tax return.
In 2021/22 the Research & Development Tax Incentive Rebate composition was changed. The premium is 18.5% above the company tax rate. With company tax rates for companies with turnovers under $20M being 25%, this means that the Research & Development Incentive Rebate remains at 43.5%.
For companies with annual turnovers over $20M:
In 2021/22 the calculation has been changed. If the research and development expenditure, as a percentage of total expenditure for the company, is up to 2%, the research and development premium will be 8.5% which is added to the applicable company tax rate to determine the Research & Development Tax Incentive Rebate that is then calculated on the legitimate research and development expenditure. If the research and development expenditure, as a percentage of total expenditure for the company, is over 2%, the research and development premium will be 16.5% which is added to the applicable company tax rate to determine the Research & Development Tax Incentive Rebate.
Accelerating Commercialisation Grant
This grant is available for companies and is for an amount of up to $1M on a 50% funding basis. The applicant’s turnover must be under $20M for each of the last 3 years. This grant is basically to fund “commercialisation activities” from the completion of the prototype until the company has completed its “first commercial sale”. The company must’ve developed a novel product, process or service that it wishes to commercialise.
Business Growth Grants
A grant to help build capacity, improve capability, extend networks and take advantage of growth opportunities. Grants of up to $20,000 are available for eligible businesses on a 50% funding basis.
Export Market Development Grant
Available to support Australian exporters. Any type of business entity can apply. There has been a change in the operation of this grant from 1st July 2021.
In 2021/22:
Eligibility turnover less than $20M per annum. An “eligibility based grant program”. Business applies for a grant approval before spending any funds. Grant applications opened 16th August and close on 30th November 2021. Grants are available in 3 tiers over a maximum of 8 years, with a total funding amount of $770,000.
A great tool to help businesses advisors and their client’s research and access grants is ESS BIZGRANTS. ESS BIZGRANTS is the quick and easy way of finding government grants, loans and incentives for small/medium enterprises. ESS BIZGRANTS has been developed for the sole purpose of locating and supplying details of any government grants/loans/incentives for which your business may be eligible.
Knowing what grants are available for your clients is a huge asset for your Business Advisory offerings and your clients, particularly during these challenging times.
Mark Holton is a respected consultant in taxation and business management, in particular, business advisory services implementation and delivery using key structured advisory systems and software. If you would like to book in for a complimentary 45-minute Business Advisory Readiness Assessment to know where your firm is today and what it needs to do to achieve success in the future, contact us to confirm a suitable time.
