36[F1(1)[F2All] of the money raised by the issuance of the relevant issue of shares must have been employed wholly for the purposes of a relevant trade not later than the time determined in accordance with sub-paragraph (1B).U.K.
F3(1A). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(1B)The time referred to in sub-paragraph (1) is—
(a)the end of the period of [F4two years] beginning with the issue of the shares, or
(b)where the [F5issuing company or a qualifying 90% subsidiary of that company had not begun to carry on the relevant trade] at the time the shares were issued, the end of the period of [F4two years] beginning when the issuing company or a [F6qualifying 90% subsidiary of that company] begins to carry on the relevant trade.
(1C)[F7Sub-paragraph (1) is] subject to sub-paragraph (5).]
(2)For the purposes of this paragraph—
“” means the issue of shares in the issuing company which includes the relevant shares;
“relevant trade” means a trade by reference to which the issuing company meets the trading activities requirement.
(3)In this paragraph references to employing money for the purposes of a trade (except where the carrying on of the trade is within paragraph 25(2)) include references to employing it for the purpose of preparing to carry on the trade.
(4)In sub-paragraph (2) the reference to a trade by reference to which the trading activities requirement is met includes, where the carrying on of that trade is within paragraph 25(2), a reference to any qualifying trade—
(a)which is derived or benefits from that trade, and
(b)which is carried on—
(i)by the issuing company, or
(ii)if that company is a parent company, by that company or a [F8qualifying 90% subsidiary] of that company.
(5)Where—
(a)[F9any of the money raised by the issuance of the relevant issue of shares] is employed for the purposes of a trade that is a relevant trade by virtue of sub-paragraph (4), and
(b)that trade was not being carried on by the issuing company, or a [F10qualifying 90% subsidiary] of that company, at the time the shares were issued,
the requirement of sub-paragraph (1) F11... is not met unless that money is so employed before the third anniversary of the issue date.
(6)For the purposes of this paragraph money is not treated as employed otherwise than wholly for the purposes of a trade if the only amount employed for other purposes is an amount which is not a significant amount.
Textual Amendments
F1Sch. 15 para. 36(1)-(1C) substituted (11.5.2001 with effect as mentioned in Sch. 16 para. 5(3) of the amending Act) for Sch. 15 para. 36(1) by 2001 c. 9, s. 64, Sch. 16 para. 5(1)(3).
F2Word in Sch. 15 para. 36(1) substituted (with effect in accordance with Sch. 8 para. 11 of the amending Act) by Finance Act 2009 (c. 10), Sch. 8 para. 8(2)
F3Sch. 15 para. 36(1A) omitted (with effect in accordance with Sch. 8 para. 11 of the amending Act) by virtue of Finance Act 2009 (c. 10), Sch. 8 para. 8(3)
F4Words in Sch. 15 para. 36(1B) substituted (with effect in accordance with Sch. 8 para. 11 of the amending Act) by Finance Act 2009 (c. 10), Sch. 8 para. 8(4)
F5Words in Sch. 15 para. 36(1B)(b) substituted (22.7.2004) (with effect in accordance with Sch. 20 para. 15 of the amending Act) by Finance Act 2004 (c. 12), Sch. 20 para. 11(a)(i)
F6Words in Sch. 15 para. 36(1B)(b) substituted (22.7.2004) (with effect in accordance with Sch. 20 para. 15 of the amending Act) by Finance Act 2004 (c. 12), Sch. 20 para. 11(a)(ii)
F7Words in Sch. 15 para. 36(1C) substituted (with effect in accordance with Sch. 8 para. 11 of the amending Act) by Finance Act 2009 (c. 10), Sch. 8 para. 8(5)
F8Words in Sch. 15 para. 36(4)(b)(ii) substituted (22.7.2004) (with effect in accordance with Sch. 20 para. 15 of the amending Act) by Finance Act 2004 (c. 12), Sch. 20 para. 11(b)
F9Words in Sch. 15 para 36(5)(a) substituted (11.5.2001 with effect as mentioned in Sch. 16 para. 5(3) of the amending Act) by 2001 c. 9, s. 64, Sch. 16 paras. 5(2)(a)(3)
F10Words in Sch. 15 para. 36(5)(b) substituted (22.7.2004) (with effect in accordance with Sch. 20 para. 15 of the amending Act) by Finance Act 2004 (c. 12), Sch. 20 para. 11(b)
F11Words in Sch. 15 para. 36(5) omitted (with effect in accordance with Sch. 8 para. 11 of the amending Act) by virtue of Finance Act 2009 (c. 10), Sch. 8 para. 8(6)