SCHEDULES

SCHEDULE 16Community investment tax relief

Part 6Withdrawal of relief

I137Value received where there is more than one investment

1

This paragraph applies where—

a

the investor makes two or more investments in the CDFI (being investments in relation to which the investor is eligible for and claims relief), and

b

the investor receives value (other than value within paragraph 35(1)(a)) which falls within the periods of restriction relating to two or more of those investments.

2

Where this paragraph applies, paragraphs 31, 32, 34 and 38 have effect in relation to each investment referred to in sub-paragraph (1)(b) as if the amount of the value received were reduced by multiplying it by the fraction—

ABmath

3

For this purpose—

a

A is the appropriate amount in respect of the investment in question, and

b

B is the aggregate of that amount and the appropriate amount or amounts in respect of the other investment or investments.

4

Where the investment consists of a loan, the appropriate amount for the purposes of sub-paragraph (3) is—

a

if the value is received in the first or second year of the period of restriction, the average capital balance of the loan for the second year of that period, and

b

if the value is received in a later year, the average capital balance of the loan for the year in question.

5

For the purposes of sub-paragraph (4)—

a

the average capital balance of the loan for a year is the mean of the daily balances of capital outstanding during the year, and

b

the receipt of value shall be disregarded when calculating the average capital balance for the year in question.

6

Where the investment consists of securities or shares, the appropriate amount for the purposes of sub-paragraph (3) is—

a

if the value is received in the first year of the period of restriction, the amount subscribed for the securities or shares, and

b

in any other case, the amount subscribed for such of the securities or shares as—

i

are held by the investor at the time the value is received, and

ii

have been held by him, as sole beneficial owner, continuously since the investment was made.