An Early Stage Venture Capital Limited Partnership (ESVCLP) is a venture fund, structured as a limited partnership, that has been registered under the Venture Capital Act 2002. Innovation and Science Australia's Innovation Investment Committee decides registration, and the Department of Industry, Science and Resources and the ATO run the program jointly. A registered ESVCLP must hold A$10 million to A$200 million of committed capital and invest in companies or unit trusts at the pre-seed to early-expansion stage, with total assets of no more than A$50 million at the time of investment, held for at least 12 months.
For limited partners, the partnership is flow-through: its income and gains pass to the partners, and a partner's share of income and gains from eligible investments is exempt from tax, subject to conditions including the 12-month holding period and full registration. Limited partners can also get a non-refundable, carry-forward tax offset of up to 10% of eligible contributions, worked out on the lesser of what they contributed in the year and their share of the eligible investments the partnership made. The general partner's carried interest is treated on capital account rather than revenue account; it is not exempt from income tax.
Registration is a threshold for a tax concession, not an endorsement of the manager or a signal about performance. A conditionally registered partnership may not be advertised as registered, and the public register on business.gov.au shows which list a partnership is on. Tax outcomes depend on each investor's circumstances, so take your own professional tax advice.