If you have a local operation that produces or manufactures a product you know the challenges of running this sort of business. It might be successful and you might think it would be a good product to sell overseas. However, many Australian business owners struggle with the thought of exporting a product because of the complexities and expenses. Some great businesses with fantastic products just never leave our shores because it just isn’t financially viable to invest in the set up of such a venture.
However, you may find that you are eligible for the Export Market Development Grant (EMDG). Facilitated by AusTrade, it has given businesses all over the country the funding to facilitate your global expansion aspirations.
The EMDG scheme encourages small and medium sized businesses to develop export markets. They do this by reimbursing up to 50% of eligible export promotion expenses above $5,000, providing that the total expenses are at least $15,000. Each applicant can receive a grant of up to $150,000 per application, to a maximum of eight annual grants.
While there is no GST on the grants you do need to keep in mind that the grant is considered assessable for income tax purposes. You also can’t claim the GST component of expenses claimed under the EMDG.
The budget that the EMDG has is $137.9 million, and in the 2017-18 financial year they paid $131.6 million to 3,706 businesses. The businesses that received these grants reported generating $3.8 billion in exports so it appears to be a success. What is very inspiring is that three quarters of the recipients were small businesses with annual incomes of less than $5 million. Without the grant these businesses may not have been able to launch into foreign exports so this is a game changer.
So who can apply?
You can be an Australian individual, partnership, company, association, cooperative or statutory corporation that has carried on business in Australia. You need to be promoting the export of goods, or delivery of services outside of Australia. You may also be able to claim if you are promoting certain services in Australia to non-residents or promoting inbound tourism. You may also eligible if you are promoting the export of intellectual property outside of Australia. You must also have an income of less than $50 million for the year.
What sort of support can you claim?
The cost of hiring overseas representation and the cost of a marketing consultant. You can also claim the cost of marketing visits, trade fairs, seminars, in store promotions and creating free samples. The promotional literature, advertising, and the registration and insurance of eligible intellectual property expenses.
So, how do you apply?
Speak to our professional team!
All applications must be submitted each year between 1 July and close of business 30 November.As tech industry professionals Azure Group are well versed in supporting business with their EMDG lodgements. Get in touch here.