Submission to Treasury on the IBCC

As part of the 2026–27 Budget, the Australian Government announced significant tax reforms, including to capital gains tax (CGT). These have serious implications for early stage investing.

Many people, including our CEO Cheryl Mack, made submissions to the Senate Committee about this.

On 18 June 2026, the government released a consultation paper on a proposed Innovative Business CGT Concession (IBCC). This is sometimes referred to as a carve-out for startups and innovative businesses.

At Ventari (formerly Aussie Angels), we welcomed this and made a further submission to Treasury on the IBCC's design.

Our submission focused on the investors the concession is designed to reach: angel investors and the syndicates and small funds that invest in Australian startups at the earliest stages. It was supported by organisations including Startmate and Advance VC, along with more than 30 individual supporters from the startup community. It also noted strong alignment with the Tech Council of Australia's submission.

As our submission said:

"Our position is straightforward. The IBCC is the right vehicle. It is the appropriate way to make sure the CGT reforms do not inadvertently withdraw support from the earliest, riskiest and most nationally valuable form of private investment. But as currently drafted, several of its parameters do not fit how early-stage investment actually works, and in their current form they would leave much of the intended benefit out of reach of the very investors it is designed for."

Key points in the submission

• Replace the innovation principles with an objective test. Our submission argued that a subjective test can't give investors certainty at the moment they invest, and estimated that an annual assessment requirement could generate around 2,000 assessments each year, with the compliance cost falling on young companies. It proposed that a company qualify if, at any time before the shares are sold, it has received the R&D Tax Incentive or issued employee share scheme interests under the existing start-up concession. If the principles are kept, it asked that this objective test be added as an alternative pathway.
• Update the thresholds. The submission proposed raising the turnover threshold to around $75 million, reflecting CPI growth since the $50 million figure was set in 2015. It also proposed lifting the age limit to 15 years for all companies.
• Shorten the holding period. It recommended a three-year minimum holding period, with a partial benefit from year three rising to the full benefit at five years, similar to the United States' Qualified Small Business Stock (QSBS) rules. For investments made through a SAFE or convertible note, the holding period should start when the funds are provided.
• Replace the lifetime cap with a per-company cap. A lifetime cap would fall hardest on founders and angel investors who succeed and reinvest. The submission proposed a cap set at the greater of a dollar floor or 10 times the capital invested, applied per company and per holder, in line with QSBS.
• Protect existing investments. Investments made before the reforms start should keep the tax treatment that applied when they were made, without needing to re-qualify under the new eligibility tests.
• Maintain and update ESIC. The submission proposed raising the Early Stage Innovation Company (ESIC) thresholds, including lifting the prior-year income limit from $200,000 to $1 million and the expenses limit from $1 million to $2 million. Eligibility should also be tested when an investment is made.
• Consider the impact on women. Fixed compliance costs weigh most on smaller raises. The submission cited data showing a median deal size in 2025 of $500,000 for all-female founding teams, compared with $3.5 million for all-male teams. It noted that an objective test and a per-company cap would both reduce this impact.

Read our full submission here.

What happened next

On 11 September 2026, the Treasurer released exposure draft legislation for the IBCC. The draft sets a 15-year eligibility period across all companies and a three-year minimum holding period. Investors using the concession won't be subject to a cap. The $50 million turnover threshold and innovation requirements remain, and the government said it will release a draft legislative instrument to help existing companies self-assess against the innovation requirements.

Consultation on the exposure draft is open until 28 September 2026.