What about IPO? or PL to Limited Conversion?

2019-04-10 18:27:03


We were recently asked 'What happens when my ESIC is listed on the ASX?' or ‘What happens when my ESIC converts from a Private into a Public Company?’

These seem like good problems to have, though it’s natural for early stage investors to become anxious, after all, they are the ones who have to prove any claim.

ESIC policy contemplated capital gain, so it should not come as a surprise to find that the tax rules do not differentiate these changes as the company progresses from strength to strength. ESIC status is established at the point of investment, not at exit.

Simply put, with all other things being aligned, the established prior ESIC status remains, and assuming the concession applies, and timing rules are met, then the taxpayer can disregard the capital gain.

*The 12 month holding rule, 10 year limitation and eligibility of the investor.

Savvy investors would be wise to review proofing documentation and or consider a private binding ruling, if they have not done so already.





Published By: Matthew at ESIC Directory