Finance Act 2009

Section 27

SCHEDULE 8 U.K. Venture capital schemes

Enterprise investment scheme U.K.

1 U.K. Schedule 5B to TCGA 1992 (enterprise investment scheme: re-investment) is amended as follows.

2 (1) Paragraph 1(2) (application of Schedule) is amended as follows. U.K.

(2) For paragraphs (g) and (h) substitute “and

(g) all of the money raised by the issue of the shares (other than any of them which are bonus shares) is, no later than the time mentioned in section 175(3) of ITA 2007, employed wholly for the purpose of that activity,”.

(3) In the words following the paragraphs, for “conditions in paragraphs (g) and (h) above do” substitute “ condition in paragraph (g) above does ”.

3 (1) Paragraph 1A (failure of conditions of application) is amended as follows. U.K.

(2) In sub-paragraph (4)—

(a) omit “or (h)”, and

(b) for “sub-paragraph (4A) below” substitute “ section 175(3) of ITA 2007 ”.

(3) Omit sub-paragraph (4A).

4 (1) Paragraph 9 (other reconstructions and amalgamations) is amended as follows. U.K.

(2) For sub-paragraph (1) substitute—

“(1) This paragraph applies if section 135 or 136 (company reconstructions) applies in relation to shares to which deferral relief, but not relief under Part 5 of ITA 2007 (or Chapter 3 of Part 7 of the Taxes Act), is attributable.

(1A) Paragraphs 3 and 4 of this Schedule have effect as if section 135 or 136 did not apply in relation to the shares.”

(3) In sub-paragraph (2), for “Sub-paragraph (1) above shall not have effect to disapply section 135 or 136 where” substitute “ Sub-paragraph (1A) does not apply if ”.

(4) For sub-paragraph (3) substitute—

“(3) Sub-paragraph (1A) does not apply if paragraph 8 applies in relation to the shares.”

5 U.K. In paragraph 16 (information), omit sub-paragraph (4A).

6 (1) Section 158 of ITA 2007 (form and amount of EIS relief) is amended as follows. U.K.

(2) In subsection (4), omit—

(a) “Subject to subsection (5),”, and

(b) “before 6 October”.

(3) Omit subsection (5).

7 (1) Section 175 of that Act (use of money raised requirement) is amended as follows. U.K.

(2) For subsection (1) substitute—

“(1) The requirement of this section is that all of the money raised by the issue of the relevant shares (other than any of them which are bonus shares) is, no later than the time mentioned in subsection (3), employed wholly for the purpose of the qualifying business activity for which it was raised.”

(3) In subsection (2), for “requirements in subsection (1)(a) and (b) do” substitute “ requirement in subsection (1) does ”.

(4) In subsection (3)—

(a) for “subsection (1)(a)” substitute “ subsection (1) ”, and

(b) for “12 months” (in both places) substitute “ two years ”.

Corporate venturing scheme U.K.

8 (1) Paragraph 36 of Schedule 15 to FA 2000 (corporate venturing scheme: requirement as to money raised) is amended as follows. U.K.

(2) In sub-paragraph (1), for “At least 80%” substitute “ All ”.

(3) Omit sub-paragraph (1A).

(4) In sub-paragraph (1B), for “12 months” (in both places) substitute “ two years ”.

(5) In sub-paragraph (1C), for “Sub-paragraphs (1) and (1A) are” substitute “ Sub-paragraph (1) is ”.

(6) In sub-paragraph (5) omit “does not apply and the requirement of sub-paragraph (1A)”.

Venture Capital Trusts U.K.

9 (1) Section 293 of ITA 2007 (use of money raised requirement) is amended as follows. U.K.

(2) For subsection (1) substitute—

“(1) The requirement of this section is that—

(a) less than two years has passed since the trading time, or

(b) at least two years has passed since the trading time and all of the money raised by the issue of the relevant holding has been employed wholly for the purposes of a relevant qualifying activity.”

(3) Omit subsections (2) to (4).

Consequential repeals U.K.

10 U.K. In consequence of the amendments made by paragraphs 2, 3 and 5, omit—

(a) in FA 2001, in Schedule 15, paragraphs 26 to 28,

(b) in FA 2004, in Schedule 18, paragraph 13(1)(f), and

(c) in ITA 2007, in Schedule 1, paragraph 345(2)(b), (3)(a) and (13)(b).

Commencement U.K.

11 U.K. The amendments made by paragraphs 2, 3, 5, 7, 8 and 10 have effect in relation to shares issued on or after 22 April 2009.

12 U.K. The amendments made by paragraph 4 have effect in relation to—

(a) any exchange of shares to which section 135 of TCGA 1992 applies, where the new holding is issued on or after 22 April 2009, and

(b) any arrangement within section 136(1) of that Act entered into on or after that date.

13 (1) The amendments made by paragraph 6 have effect as follows. U.K.

(2) The amendments made by sub-paragraph (2) have effect in relation to shares issued in the tax year 2009-10 or a subsequent tax year.

(3) The amendment made by sub-paragraph (3) has effect in relation to claims made under section 158(4) of ITA 2007 in respect of shares issued in the tax year 2009-10 or a subsequent tax year.

14 U.K. The amendments made by paragraph 9 have effect in relation to shares or securities issued on or after 22 April 2009.