You can see the rules and regulations in other jurisdictions.
The continuing increase of fintech players in Australia has generated a substantial amount of public data that can be used to analyse trends and identify concentrations of fintech companies and their activities. ASIC's Innovation Hub website also supplies guidance and details on events related to fintech.1
Investing in fintechs could be made possible with early-stage venture capital limited partnerships and venture capital limited partnerships, both of which are incorporated in Australia and enjoy concessional tax treatment. Subject to meeting certain qualifications, such investments may be eligible for beneficial tax treatment. The investment vehicle can provide several advantages, such as tax reliefs to resident and non-resident investors on both revenue and capital gains when disposing of the investment. Moreover, there is a 10 per cent non-refundable tax offset available for new capital investments as well as the carried interest of fund managers that are treated on capital account.1
The R&D Tax Incentive can be accessed by entities who incur costs on research and development (R&D) activities, including many of the software-based studies conducted by fintech organisations. Under the R&D Tax Incentive, those who are eligible may be able to receive either one of two incentives:
Significant amendments to the R&D Tax Incentive have been put into effect starting in the income year beginning on or after July 1, 2021. Under the new regulations, firms with an accumulated turnover of less than A$20 million can access a refundable tax offset of 43.5 per cent, which is 18.5% higher than the corporate rate of 25% from July 1st 2021. Changes were made which resulted in the introduction of an 'incremental intensity threshold'. This affects companies with a turnover of A$20 million or higher, granting them a tax offset in accordance with the proportion of their eligible R&D expenditure relative to their total business expenditure.1
