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ARTICLE · 15 SEPTEMBER 2004

Venture Capital and Non-Portfolio Dividends: More Changes

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Taxation Laws Amendment (2004 Measures No.3) Act No.105 of 2004 has made amendments to the changes made in 2002 to taxation of venture capital investments in Australia.

AustraliaFinance and Banking
Anton Joseph
Anton Joseph

A. Venture Capital

Taxation Laws Amendment (2004 Measures No.3) Act No.105 of 2004 has made amendments to the changes made in 2002 to taxation of venture capital investments in Australia. (Please click on 'Next Page' link at the bottom of this page to view an earlier article on this subject.)

The 2002 amendments resulted in certain venture capital limited partnerships being treated as partnerships and not companies for Australian income tax purposes. In general Limited partnerships are taxed as companies, which means the limited partnership will be taxed at the entity level in Australia before the profits are distributed to the non-resident partners.

The changes in 2002 introduced the above tax treatment to 3 types of limited partnerships: Venture capital limited partnership ("VCLP"), Australian Venture capital fund of funds ("AFOF") and Venture capital management partnership ("VCMP").

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