Top 5 Australian government grants for small businesses you should know about

As a small business owner, you would inevitably have experienced one of the many pain points that small business entrepreneurs face: dealing with and staying up-to-date with regulation when expanding into new markets, and ensuring that your intellectual property (IP) rights are adequately protected. With its business-friendly environment, many of these risks can be mitigated with the small business grants and support available to small business entrepreneurs in Australia.

Here, we highlight the top five Australian government grants for small businesses you should make sure you don’t miss out on!

1.Access business advisers under the Accelerating Commercialisation Grant

Introduced in 2014, the Entrepreneurs’ Programme replaced Commercialisation Australia and the Innovation and Investment Fund in 2014. The Accelerating Commercialisation Grant is one of the schemes or small business grants made available under the Entrepreneurs’ Programme that aims to help small businesses and entrepreneurs to commercialize novel products, services, and processes. If you are a successful Grant recipient, you will receive a grant of up to 50% of the expenditure. This grant provides projects up to 50% of the expenditure to a maximum of:

• $250,000 for commercialisation offices and eligible partner entities
• $1 million for all other applicants.

Accelerating Commercialisation Grant recipients will also receive Portfolio Services for the duration of the project.

Who can apply?

Applicants must be one of the following to apply:

• a for-profit company registered and operating in Australia
• a commercialisation office or Eligible Partner Entities
• individuals, partnerships or trustees who agree to form a for-profit company.

Applicants must first receive Commercialisation Guidance.

Commercialisation Guidance is available to applicants that:

• have a novel product, process or service they wish to commercialise
• want to trade to customers external to the state or territory of their place of business
• are not named by the Workplace Gender Equality Agency as a non-complying organisation.

After receiving Commercialisation Guidance, to apply for an Accelerating Commercialisation Grant, applicants must meet each of the following:

• have a novel product, process or service they wish to commercialise
• have the ownership, access or beneficial  use of the intellectual property to undertake the commercialisation project
• meet the turnover test  outlined at Section 5 of the Customer Information Guide
• show they can fund at least 50% of the project expenditure. This may include labour (plus on-costs), contracts, manufacturing plant, pilot and prototype manufacturing expenditure.

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2.Fight stagnation & grow your business with growth and innovation grants

A common fear of many small business entrepreneurs is that their business will stagnate due to a variety of reasons – burnout, rising competition, or simply a lack of funds. With the Business Growth Grants, you can push past stagnation in order to take your business to the next level. Engage external expertise to help your business implement improvements through a business evaluation, supply chain facilitation, growth service or tourism partnership service and the Business Growth Grant  as australian government grants will reimburse your business for up to half of the cost of doing so (to a maximum of AUD 20,000).

Under the Innovation Connections Facilitation component, your business can work with experienced Innovation Facilitators to identify knowledge gaps that are impeding business growth. The Innovation Connections Grant will reimburse you 50% of the total project costs (up to the value of AUD 50,000).

Who can apply ?

To be eligible for an Innovation Connections Facilitation, your business must:

• be a solvent, for-profit, non-tax exempt company that is registered for GST and incorporated and operating in Australia
• be a company with trading activities that are the majority of its overall activities
• have filed Business Activity Statements showing ongoing trading in at least three successive years
• have an annual turnover or operating expenditure in the current or one of the two previous financial years:
  • between $1.5 million and $100 million or
  • between $750,000 and $100 million for applicants from remote Australia or Northern Australia
• not have received an Innovation Connections Facilitation before
• satisfy one of the following:
  • be operating in one or more growth sectors:
    • advanced manufacturing
    • food and agribusiness
    • medical technologies and pharmaceuticals
    • mining equipment, technology and services
    • oil, gas and energy resources, or
  • provide enabling technologies or services to one or more of the growth sectors, or
  • show commitment to, and have the skills, capability, intellectual property or expertise to operate in, one of the growth sectors in the future.

You cannot apply if you are:

• an individual
• a partnership
• a trust (however, an incorporated trustee that meets the trading activity requirements above may apply on behalf of a trust)
• a Commonwealth, State or Local Government agency or body (including government business enterprises)
• named by the Workplace Gender Equality Agency as an organisation that has not complied with the Workplace Gender Equality Act 2012 (Cth).

3.Strengthen your company’s capabilities with the R&D Tax Incentive

Research and Development (R&D), while crucial, may not be possible for your small business due to prohibitive costs. The R&D Tax Incentive  as australian government grants helps to offset some of the costs of conducting eligible R&D activities. Companies that have incurred R&D expenditure of at least AUD 20,000 may apply. If your R&D expenditure is less than AUD $20,000, you may still apply if you have conducted your R&D through a Research Service Provider (RSP) or Co-operative Research Center.

Who can apply?

At a minimum, applicants must:

• be an incorporated company
• be conducting eligible core R&D activities. These are defined in the legislation as being experiments that are guided by hypotheses and conducted for the purpose of generating new knowledge
• have incurred eligible R&D expenditure or notional deductions of at least $20,000 (unless using a Research Service Provider or a Cooperative Research Centre).

To be eligible for the R&D Tax Incentive you must:

• be a company that is liable to pay income tax in Australia.
• conduct at least one activity that meets the legislated definition of a core R&D activity.
  • Core R&D activities involve at least one hypothesis guided experiment that is undertaken to generate new knowledge.
  • Other non-experimental activities that directly support a core R&D activity may be eligible as supporting R&D activities.

You may claim for some R&D conducted overseas under certain circumstances.

4.Enter new markets abroad with the EMDG

If you are a small business owner, you may qualify for the Export Market Development Grants (EMDG) scheme as australian government grants. This is a financial assistance programme for expiring and current exporters that is administered by Austrade. The EMDG scheme will reimburse up to 50% of eligible export promotion expenses above AUD 5,000 provided that the total expenses are at least AUD 15,000.

Who can apply?

Any Australian individual, partnership, company, association, co-operative, statutory corporation or trust that has carried on export promotion activities during the year for which they seek an export grant can apply.

To be eligible, the business must have:

• income of not more than $50 million in the grant year
• incurred at least $15,000 of eligible expenses under the scheme (first-time applicants can combine two years expenses)
• principal status for the export business (some exceptions apply, such as non-profit export-focused industry bodies).

The business also must have promoted one of the following:

• the export of goods or most services
• inbound tourism
• the export of intellectual property and know-how
• conferences and events held in Australia

Certain organisations and groups, who would not otherwise be eligible to apply for a grant under the general provisions of the EMDG Act can obtain approved status to enable them to apply for a grant in their own right. The two categories of approved status available are:

• Approved Body (PDF) – an export-focused peak industry association promoting on behalf of its industry
• Joint Venture (PDF) – a group of small to medium Australian businesses cooperating in a joint venture-style marketing arrangement

5.Grow your business with CSIRO Kick-Start.

Business and starts up can get up to $50,000 in matched funding to help them further develop and grow their business by partnering with Australia’s Commonwealth Scientific and Industrial Research Organisation (CSIRO) in research activities

Kick-start is a new initiative that targets innovative Australian start-ups and small SMEs started in early 2017 to support local startups “on their way to becoming Australian success stories”

Eligibility – who can access CSIRO Kick-Start?

Australian businesses will need to provide evidence they meet the following criteria as part of the application process:

• Have an annual turnover and operating expenditure <$1.5million, in the current and each of the two previous financial years OR have been a registered company for less than three years,
• Have an ACN and be registered for GST, and
• Be able to demonstrate they can fully support their proportion of the project funding.

Eligible companies are able to apply for a second Kick-Start project, after completion of their first, providing the total funding provided by SME Connect under CSIRO Kick-Start does not exceed $50,000.

6.Unlocking Capital for Jobs

• Australian Government grants help to small- and medium-sized businesses secure commercially viable loans
• Lets businesses access loans with more preferable terms

This program targets small- and medium-sized businesses to help them to secure commercially viable loans. It lets businesses access loans with more preferable terms

Who can apply ?

• Available in South Australia
• The lender, the business applicant and the terms of the loan itself must fulfill prescribed criteria
• When business applicants meet lending criteria but are unable to provide security for a commercial loan, the government steps in and provides a guarantee. The state government must believe that the guarantee of the loan will facilitate job creation and business growth.

7.Shave off your tax commitments with the small business entity concessions

As a small business with limited resources, you may constantly feel that you’re struggling to stay afloat. You can heave a sigh of relief if you are a small business with an aggregated turnover of less than AUD 2 million in Australia qualify for a range of concessions. This includes income tax concessions and GST and excise concessions. These tax concessions only reduce the tax burden of small businesses but also makes the accounting administration burden more manageable.

Who can apply?

These Australian government grants work out if you are eligible for small business entity concessions, you first need to work out if you are a ‘small business entity in an income year. You must review your eligibility each year to check if you are able or required to use a particular concession.

From 1 July 2016, you are a small business entity if you are a sole trader, partnership, company or trust that:

• operates a business for all or part of the income year, and
• has an aggregated turnover less than $10 million (the turnover threshold).

From here on, when we say:

• ‘small business’, we mean ‘small business entity’
• ‘turnover’, we mean ‘aggregated turnover’.

From 1 April 2017, the turnover threshold for fringe benefits tax (FBT) concessions increased to $10 million.

The $10 million turnover threshold applies to most concessions, except for:

• the small business income tax offset, which has a $5 million turnover threshold
• the capital gains tax (CGT) concessions, which continue to have a $2 million turnover threshold.

For previous income years, you are a small business if your turnover is less than $2 million.