The Venture Capital Trust (Amendment) Regulations 2016

Cited asSI 2016/1192
JurisdictionUK Non-devolved

2016No. 1192

INCOME TAX

The Venture Capital Trust (Amendment) Regulations 2016

Made7thDecember2016

Laid before the House of Common8thDecember2016

Coming into force29thDecember2016

The Treasury make the following Regulations in exercise of the powers conferred by sections 272 and 284(1)(d) of the Income Tax Act 2007( 1).

Citation, commencement and effect

1.—(1) These Regulations may be cited as the Venture Capital Trust (Amendment) Regulations 2016 and come into force on 29th December 2016.

(2) These Regulations have effect for each specified period ending on or after 31st December 2016.

(3) For the purposes of this regulation, ‘specified period’ has the meaning given in regulation 22(2) of the Venture Capital Trust Regulations 1995( 2).

Amendments to the Venture Capital Trust Regulations 1995

2. The Venture Capital Trust Regulations 1995 are amended as follows.

Regulation 22 (return containing particulars of investments)

3.—(1) Regulation 22 is amended as follows.

(2) In paragraph (1), after ‘paragraph (4)’ insert ‘and regulation 22A’.

(3) In paragraph (3), for ‘shorter’ substitute ‘earlier’.

(4) In paragraph (4)—

(a) at the end of sub-paragraphs (d)(ii) and (e)(iii), omit ‘and’, and

(b) after sub-paragraph (e)(iv) insert—

‘, and

(v) the value at which the investment was disposed of;

(f) in respect of each fund manager of the company during the specified period—

(i) the name and address of its registered or principal office, and

(ii) its Financial Services Register reference number;

(g) where a new investment was made during the specified period—

(i) immediately before the relevant holding was issued, the value of the relevant company's gross assets, or if it was a parent company( 3), the value of the group assets( 4),

(ii) the total investment in the relevant company at the investment date (within the meaning given by section 280B(3A))( 5), less the value of the new investment,

(iii) a description of each qualifying activity( 6), whether carried on by the relevant company( 7) or one of the companies mentioned in section 291(7) and (8), for the purposes of which, at the time the relevant holding( 8) was issued, the money raised was intended to be used,

(iv) when the relevant holding was issued, the relevant company's full-time equivalent employee number( 9), or if it was a parent company, the sum of the full-time equivalent employee number for it and each of its qualifying subsidiaries( 10), and

(v) whether or not the relevant company received a non-statutory opinion from Her Majesty's Revenue and Customs on the eligibility of that investment as a qualifying holding, and if it did—

(aa) whether that opinion indicated that the investment would or would not be likely to be eligible as such, and

(bb) the date of that opinion;

(h) where a new investment was made during the specified period, but after the end of the initial investing period( 11) of the relevant company—

(i) under which of conditions A, B or C of section 280C( 12) the investment was made, and

(ii) the date of the relevant first commercial sale( 13) made by the relevant company; and

(i) where a new investment was made during the specified period and the relevant company was a knowledge-intensive company( 14) on the date the investment was made—

(i) whether or not the total investment in the relevant company at the investment date exceeded the amount specified in section 280B(2)(b)(ii)( 15),

(ii) whether or not the investment was made after the period specified in section 280C(3)(b), and

(iii) whether or not the full-time equivalent employee number provided further to sub-paragraph (g)(iv) exceeded the number specified in section 297A(3A)(b)( 16) at the time the relevant holding was issued.

(4A) Expressions used in Chapter 4 of Part 6 which are also used in sub-paragraphs (g), (h) and (i) of paragraph (4) have the same meaning in those sub-paragraphs as they do in that Chapter.’

Regulation 22A (particulars to be returned in respect of relevant investments, raised money and derived money relating to the traceable period)

4. After regulation 22 insert—

Particulars to be returned in respect of relevant investments, raised money and derived money relating to the traceable period

22A.—(1) Where condition one or condition two applies, the return required by regulation 22(1) must also contain the particulars specified in paragraphs (4) and (5).

(2) Condition one is that on the last day of the specified period—

(a) the company held a relevant investment, and

(b) that relevant investment would not have been capable of being regarded as comprised in the company's qualifying holdings on that day unless it had been acquired using raised money or derived money.

(3) Condition two is that—

(a) on the last day of the specified period the company held derived money,

(b) on that day, the company maintained information identifying derived money or relevant investments acquired using raised money or derived money, and

(c) the purpose or one of the main purposes of maintaining that information was to be able to make any future relevant investment which would not be capable of being comprised in the company's qualifying holdings unless it was made using derived money.

(4) The particulars specified are—

(a) for each relevant investment held at any time during the specified period which the...

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