Income Tax Act 2007

Taxation of Chargeable Gains Act 1992 (c. 12)

345 (1) Amend Schedule 5B (enterprise investment scheme: re-investment) as follows.

(2) In paragraph 1(2) (application of Schedule)—

(a) in paragraph (e) after “that Act)” insert “, or the requirements of section 183 of ITA 2007,”, and

(b) in paragraph (g) after “Taxes Act” insert “or section 175(3) of ITA 2007”.

(3) In paragraph 1A (failure of conditions of application)—

(a) in sub-paragraph (4A) after “Taxes Act” insert “or section 175(3) of ITA 2007”,

(b) in sub-paragraph (5) for “or section 310(2) of the Taxes Act” substitute “, section 310(2) of the Taxes Act or section 241(3) of ITA 2007”, and

(c) in sub-paragraph (7) after “Taxes Act” insert “or section 236(1) of ITA 2007”.

(4) In paragraph 4 (gains accruing on chargeable event)—

(a) in sub-paragraph (4) after “Taxes Act” insert “or Part 5 of ITA 2007” and after “that Chapter”, in each place where it occurs, insert “or that Part”,

(b) in sub-paragraph (4A) after “Taxes Act” insert “or Part 5 of ITA 2007”, after “that Chapter” insert “or that Part” and for “that Act” substitute “the Taxes Act or section 245 of ITA 2007”, and

(c) in sub-paragraph (4C) after “Taxes Act” insert “or Part 5 of ITA 2007”.

(5) In paragraph 6 (claims)—

(a) in sub-paragraph (1) after “Taxes Act” insert “or sections 202(1), 203(1) and 204 to 207 of ITA 2007” and for “that Act in respect of eligible shares” substitute “the Taxes Act or Part 5 of ITA 2007 in respect of eligible or relevant shares”,

(b) in sub-paragraph (2) for “That section” substitute “Section 306”, and

(c) after that sub-paragraph insert—

“(3) Sections 202(1), 203(1) and 204 to 207 of ITA 2007, as they so apply, shall have effect as if any reference to the requirements for the relief were a reference to the conditions for the application of this Schedule.”

(6) In paragraph 7(1) (reorganisations)—

(a) after “the Taxes Act” insert “or Part 5 of ITA 2007”, and

(b) after “that Chapter” insert “or that Part”.

(7) In paragraph 8 (acquisition of share capital by new company)—

(a) in sub-paragraph (1)(e)(ii) for “subsection (2) of section 306 of the Taxes Act” substitute “section 306(2) of the Taxes Act or section 203(1) of ITA 2007” and for “that section” substitute “section 306 of the Taxes Act or sections 204 and 205 of ITA 2007”,

(b) in sub-paragraph (5)(a) after “Taxes Act” insert “or section 203(1) of ITA 2007”, and

(c) in sub-paragraph (7) after “Taxes Act” insert “or section 185 of ITA 2007”.

(8) In paragraph 9 (other reconstructions and amalgamations)—

(a) in sub-paragraph (1) after “Taxes Act” insert “or Part 5 of ITA 2007”,

(b) in sub-paragraph (3) after “Taxes Act” insert “or Part 5 of ITA 2007”, and

(c) in sub-paragraph (4)(b) for “subsection (2) of section 306 of the Taxes Act” substitute “section 306(2) of the Taxes Act or section 203(1) of ITA 2007” and for “that section” substitute “section 306 of the Taxes Act or sections 204 and 205 of ITA 2007”.

(9) In paragraph 11(5) (pre-arranged exits)—

(a) after “trading group” insert “(a)”, and

(b) at the end insert “, or

(b) is a reference to a company that meets the trading requirement in section 181(2)(b) of ITA 2007.”

(10) In paragraph 13(5) (value received by investor) after “Taxes Act” insert “or Chapter 2 of Part 5 of ITA 2007”.

(11) In paragraph 13C (provision supplemental to paragraph 13B)—

(a) in sub-paragraph (3) for “Sub-paragraph (4) below” substitute “This sub-paragraph”, and

(b) for sub-paragraph (4) substitute—

“(4) Where either of the following applies—

(a) sub-paragraph (3) above, and

(b) section 223(3) of ITA 2007 (which makes corresponding provision in relation to EIS relief under Part 5 of that Act),

the person who subscribes for the shares shall not by virtue of his subscription for those shares or any other shares in the same issue be treated as making a qualifying investment for the purposes of this Schedule.”

(12) In paragraph 14(3) (value received by other persons)—

(a) after “Taxes Act”, in the first place where it occurs, insert “or Part 5 of ITA 2007”,

(b) for “that Act” substitute “the Taxes Act or section 209 or 216(2)(a) of ITA 2007”, and

(c) after “section 300 of the Taxes Act” insert “or 214 of ITA 2007”.

(13) In paragraph 16 (information)—

(a) in sub-paragraph (4)—

(i) after “Taxes Act”, in the first place where it occurs, insert “or section 203(1) of ITA 2007”, and

(ii) after “Taxes Act”, in the second place where it occurs, insert “or section 175(3) of ITA 2007”,

(b) in sub-paragraph (4A) after “Taxes Act” insert “or section 175(3) of ITA 2007”,

(c) in sub-paragraph (6) after “Taxes Act” insert “or section 176(4)(b) or (5)(b), 182(2) or (4), 183(6), 185(1), 190(1)(e) or 191(2)(c), (3), (4) or (5) of ITA 2007”,

(d) in sub-paragraph (7)—

(i) in paragraph (a) after “Taxes Act” insert “or section 182(2) or (4) of ITA 2007”,

(ii) in paragraph (aa) after “Taxes Act” insert “or section 176(4)(b) or (5)(b), 183(6) or 191(3), (4) or (5) of ITA 2007”, and

(iii) in paragraph (c) after “Taxes Act” insert “or section 185(1), 190(1)(e) or 191(2)(c) of ITA 2007”, and

(e) in sub-paragraph (7A)—

(i) after “Taxes Act” insert “and subsections (3), (4) and (5) of section 191 of ITA 2007”, and

(ii) for “that Act” substitute “the Taxes Act or section 190(2) of ITA 2007”.

(14) In paragraph 19(1) (interpretation)—

(a) in the definition of “eligible shares” for “that Act” substitute “the Taxes Act or means shares that meet the requirement in section 173 (2) of ITA 2007”,

(b) in the definition of “ordinary share capital” for “the same meaning as in the Taxes Act” substitute “the meaning given by section 989 of ITA 2007”,

(c) in the definition of “qualifying business activity” after “Taxes Act” insert “or section 179 of ITA 2007”,

(d) for the definition of “qualifying company” substitute—

““qualifying company”, in relation to any eligible shares, means a company which, in relation to those shares, is—

(a) a qualifying company for the purposes of Chapter 3 of Part 7 of the Taxes Act (except that for the purposes of this Schedule the reference in section 293(1B)(b)(i) of that Act to section 304A of that Act shall be read as a reference to paragraph 8 above), or

(b) a qualifying company for the purposes of Part 5 of ITA 2007 (except that for the purposes of this Schedule the reference in section 184(1)(c)(i) of that Act to section 247 of that Act shall be read as a reference to paragraph 8 above).”

(e) in the definition of “the relevant period” for “that Act” insert “the Taxes Act or section 159(2) of ITA 2007”, and

(f) in the definition of “termination date” after “Taxes Act” insert “or section 256 of ITA 2007”.

(15) In paragraph 19(3) omit the “and” immediately before paragraph (c) and after that paragraph insert “; and

(d) references to Part 5 of ITA 2007 or any provision of that Part are to a Part or provision that applies only in relation to shares issued on or after 6th April 2007”.