TCF STRATEGIC NEWS
September 2011: The final newsletter for the TCF Post-2005
(SIP) Scheme
TCF Post-2005 (SIP) Scheme is now closed
After five years, the TCF Post-2005 (SIP) Scheme closed on 30 June 2011. Over this period,
$487.5 million in grants was allocated to more than 500 businesses as a return on capital
investment and innovation investment activities. In this past year the team assessed 373
claims and 266 advances for a total of $99.16 million in grants. A breakdown of grants by
sector for the 2009-10 program year is as follows:
Payments by Sector (Financial Year 2010/2011)

Textiles $32.71 million (33%),

Clothing $32.88 million (33%),

Carpet $22.88 million (23%),

Technical Textiles $4.64 million (5%),

Footwear $3.75 million (4%),
 Leather $2.31 million (2%).
The modulation factor for the 2009-10 program year was 0.815624348969 - the highest
since the program began. In comparison, the modulation factor for 2008-09 was 0.771 and
in 2007-08, the figure was 0.736.
I would like to thank all our customers for their assistance as we administered the scheme
over these past five years. To those of you not participating in the Clothing and Household
Textile (Building Innovative Capability) scheme (BIC scheme), the TCF Post-2005 (SIP)
Scheme team would like to wish you well in the future.
Jana Ceferin: TCF Post-2005 (SIP) Scheme Program Manager
Ongoing Obligations
While the Scheme has closed, the grants were paid subject to a number of conditions. Two
key conditions relate to the disposal of TCF plant and equipment and record retention.
Disposal of TCF plant and equipment subsidised with a TCF Post-2005 (SIP) Scheme Type 1
grant.
It is a condition of a Type 1 grant to an entity that any plant or equipment in relation to
which the grant is made is not to be disposed of by either sale, as scrap, or otherwise, before
the end of the program period. For clothing and household textile entities the end of the
program period is 30 June 2015. If items are disposed, depending on the circumstances the
grant must be repaid.
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For all other entities (including yarn, textile, carpet, footwear and technical textile entities),
the end of the program period is 30 June 2010. A scheme debt may arise if the value of the
plant or equipment at the time of disposal is more than 70% of the economic life of the plant
or equipment when new. Please contact the office if you are disposing of plant or equipment
for which you received a grant.
Document retention: All documents and records relied upon to apply for a grant must be
retained for 5 years from the date of payment (until June 2016).
Other Government Assistance
For those entities not continuing under the BIC scheme there are a range of other assistance
measures you may wish to explore. These include:
The R&D Tax Incentive provides a 45 per cent refundable tax offset to eligible entities with
an aggregated turnover of less than $20 million per annum or a non-refundable 40 per cent
tax offset to all other eligible entities.
The Tradex Scheme allows an importer to gain an up-front exemption from Customs duty
and GST on eligible imported goods that are intended for export.
Enterprise Connect offers comprehensive advice and support to eligible Australian small and
medium-sized enterprises to help them transform and reach their full potential.
Business.gov.au offers simple and convenient access to all the government information,
forms and services you need. It's a whole-of-government service providing essential
information on planning, starting and growing your business as well as access to the Grants
and Assistance Finder for a list of all Australian, State and Territory grants.
The Clothing and Household Textile Building Innovative Capability
Scheme (BIC Scheme)
Deadlines for applications for the 2010-11 program year
Entities registered for the 2010-2011 program year may submit an application for an
advance or a claim using the relevant application form to be received by AusIndustry by the
dates specified below.
Requests for advances of grants by Tuesday 3 January 2012
Lodgement of claims for grants by Wednesday 29 February 2012
A completed claim/determination document must be signed by a director or senior
employee of the registered entity, be accompanied by an audit opinion prepared by a
registered external auditor, and include all required information such as project
descriptions.
New Application Forms
To streamline the transition to the new scheme, the structure and the format of the
application forms remain largely the same as for TCF Post-2005 (SIP). We have updated a
number of sections and added some additional questions to further streamline our
assessment processes. These include:
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
information regarding your record keeping systems,

additional details on the project description templates, and
 the registered auditor number of the auditor preparing your statements.
Note: AusIndustry offices will be closed from 26 December 2011 to 2 January 2012. Offices
will reopen 3 January 2012.
Modulation and Advance Payments
Based on registrants’ estimates of the expenditure and revenue for the 2010-11 program
year, AusIndustry has estimated a potential modulation rate of 0.50. Given this is the first
year of the scheme there is considerable uncertainty regarding this figure. The grant
eligibility amount is subject to TER capping @ 5% and modulation.
Please find below a sample calculation. Advances will be paid up to half the estimated grant
eligibility amounts.
Innovation expenditure $140,000
Grant eligibility amount (@50%)$ 70,000
Total Eligible Revenue (TER)
$1.2 million
5 % TER cap on grant eligibility $60,000
Pre-modulated grant eligibility amount: $60,000
Modulation factor (estimated) 0.50
Estimated grant entitlement:
$30,000
(0.5 X $60,000)
Advance payment is 50% of estimated
grant entitlement:
$15,000
If the modulation factor is lower (e.g. 0.4), the actual grant entitlement would be 0.4 x
$60,000 = $24,000. A final grant payment of $9,000 would be paid in June 2012.
This entity will have an excess of $10,000 ($70,000 - $60,000). Modulated excess amount @
0.40 = $4,000 (available for determination in the following year).
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Record keeping and substantiation of claims – fact sheets
To assist you in understanding the BIC scheme there are a number of BIC scheme ‘fact
sheets’ available on the AusIndustry website. One of these is a guide to Record keeping,
substantiation and apportionment.
The fact sheet details the type of records AusIndustry expects to see to substantiate claimed expenditure.
For example, records relating to salary costs must include a record of time spent by employees on various
activities relating to projects. Material costs claimed must be supported by documentation.
Records should clearly substantiate the claimed expenditure and the activities to which the expenditure
relates. This should enable the verification and timing of expenditure and establish that the amounts
claimed are directly attributable to particular eligible clothing and household textile activities.
Where appropriate records are not kept the expenditure may be found ineligible or a grant may be
repayable under the scheme.
Claim for 2010/11 to get your excess
To access any excess amount from TCF Post-2005 (SIP) you must make a claim for the 2010/11 program
year, even if this is only for the excess amount. If you do not make a claim the excess amount will not be
included in subsequent program years. Please call your customer service manager if you have any
questions.
Our Claim form has been updated and is now available at
www.ausindustry.gov.au
Contacting AusIndustry
Contact your customer service manager directly using:

the email protocol name.surname@innovation.gov.au

by phone to the Victorian State Office of AusIndustry on (03) 9268 7555 or

via the AusIndustry Hotline on 13 28 46
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