7.—(1) This regulation specifies charges to, and exemptions from, tax which apply in the case of a venturing company and a joint venture company to which these Regulations apply.
(2) Section 111 (effects of entry) and section 131 (effects of cessation) shall apply to the proportion of assets and business of the joint venture company in which the venturing company has an interest.
For this purpose references in those sections to—
(a)C (pre-entry) shall be read as references to the venturing company’s interest in the joint venture company before the date on which a joint venture look through notice becomes effective;
(b)C (tax-exempt) shall be read as references to the venturing company’s share of the property rental business of the joint venture company from the date on which a joint venture look through notice becomes effective.
(3) Section 112 (entry charge) shall have effect in relation to a venturing company and a joint venture company with the following modifications—
(a)a reference to a company to which Part 4 applies shall be treated as a reference to a UK resident joint venture company to which these Regulations apply, and
(b)the reference in subsection (3)(a) to the aggregate market value of assets shall be treated as including the proportion of the venturing group member’s interest in the aggregate market value of the assets of the property rental business of the joint venture company.
(4) Section 117 (cancellation of tax advantage) shall apply to the joint venture company.
For this purpose references to a “company” shall be read as including a reference to a joint venture company to which these Regulations apply.
(5) Sections 119(1) (exemption from corporation tax) and 120 (calculation of profits) shall apply in relation to the venturing company’s share of the profits deriving from the property rental business of the joint venture company.
(6) Sections 124(1) and (2), 125 and 126 (corporation tax provisions) shall apply in relation to the venturing company’s share of a gain accruing to the joint venture company in respect of assets involved in the property rental business.
For this purpose references to—
(a)C (tax-exempt) shall be read as references to the venturing company and the UK property rental business of the joint venture company; and
(b)C (residual) shall be read as references—
(i)to the venturing company insofar as it carries out business which is not tax exempt; and
(ii)to the joint venture company insofar as it carries on other business which is not property rental business.
(7) For the purposes of this regulation a reference to the “UK property rental business of the joint venture company” is a reference to—
(a)the property rental business of the joint venture company if that company is UK resident, and
(b)the property rental business in the UK of the joint venture company if that company is not resident in the UK.