The Venture Capital Trust (Winding up and Mergers) (Tax) (Amendment) Regulations 2011

1

In these Regulations, references to provisions of an Act or to Parts of an Act are to provisions or Parts of the Income Tax Act 2007 unless otherwise stated.

2

In these Regulations—

• “the Commissioners” means the Commissioners for Her Majesty’s Revenue and Customs;

• “market value” shall be construed in accordance with sections 272 and 273 of the Taxation of Chargeable Gains Act 19923;

• “the 1992 Act” means the Taxation of Chargeable Gains Act 1992;

• “prescribed winding-up period”, in relation to a VCT-in-liquidation, means the period—

  1. a

     beginning on the commencement of the company’s winding-up, and

  2. b

     ending on the earliest of—

     1. i

        the end of the company’s winding-up;

     2. ii

        the company’s ceasing to be wound up;

     3. iii

        the dissolution of the company;

     4. iv

        the third anniversary of the commencement of the winding-up;

• “qualifying holdings” shall be construed in accordance with Chapter 4 of Part 6;

• “securities”, except in regulation 12, has the same meaning as in section 285(2);

• “statement of affairs” means a statement as to the affairs of a company, in the form prescribed under and complying with section 99 or 131 of the Insolvency Act 19864;

• “the 15% test” means the 15% holding limit condition specified in the table in section 274(2) and as provided for in sections 275 to 279;

• “the 70% tests” means the conditions specified in the last two entries in the table in section 274(2) and as provided for in sections 275, 278, 280 and 280A5;

• “the 30% test” means the condition which was specified in the table at section 274(2) and as provided for in sections 275, 278 and 280, ignoring the amendments made to section 274(2) by paragraph 2(2)(b) and (c) of Schedule 2 to the Finance (No. 3) Act 20106.

3

In regulations 9 to 14 and in this paragraph—

• a “section 323(1) merger” means a merger described in section 323(1);

  a “section 323(2) merger” means a merger described in section 323(2);

• “share for business transfer” means an issue of shares as mentioned in section 323(1)(b)(ii) or 323(2)(b)(ii), as the case may be;

• “share for share exchange” means an exchange of shares as mentioned in section 323(1)(b)(i) or 323(2)(b)(i), as the case may be;

• “shares issued to effect the merger” means—

  1. a

     in the case of a section 323(1) merger, shares in the successor company issued as mentioned in section 323(1); and

  2. b

     in the case of a section 323(2) merger, shares in the successor company issued as mentioned in section 323(2);

• “shares issued for new consideration” means shares in the successor company issued in the period during which the merger takes place for a consideration other than as mentioned in section 323(1)(b) or 323(2)(b).

4

Section 319(3) (references in sections 314 to 318 to things done by a VCT-in-liquidation to include things done by the liquidator of a VCT-in-liquidation) shall apply for the purposes of regulations 3 to 8 as it applies to Chapter 5 of Part 6.