On 12 May 2026, as part of the 2026–27 Federal Budget, the Government announced it will modernise the Early-Stage Venture Capital Limited Partnership (ESVCLP) and Venture Capital Limited Partnership (VCLP) tax incentives to adjust for inflation by increasing caps on investee business assets and maximum fund size.
This measure is not yet law.
To ensure that incentives align with modern company valuations:
- Tax concessions will be available where ESVCLPs invest in businesses with assets up to $80 million at the time of investment – up from the $50 million asset cap set in 2007 (on ESVCLP introduction).
- ESVCLP investors may access tax concessions with respect to investee businesses with assets up to $420 million – up from the $250 million asset cap set in 2007.
- ESVCLPs may have total committed capital of up to $270 million – up from $200 million as last increased in 2016, and from the $100 million fund size cap set in 2007.
- Tax concessions will be available where VCLPs invest in businesses with assets up to $480 million at the time of investment – up from the $250 million asset cap set in 2002 (on VCLP introduction).
In addition, the Government announced that it will abolish the Eligible Venture Capital Investors (EVCI) program that was introduced to provide equivalent tax benefits for director foreign investors rather than via a limited partnership.
All changes to the ESVCLP and VCLP programs are proposed to come into effect from 1 July 2027 and will apply to new and existing funds and investments. The abolishment of the EVCI program will come into effect from the date of announcement, 12 May 2026.
For more information, see: