VCM60622 - VCT scheme: general: return of investments made by VCT: identifying investments funded by different issues of shares: protected money
Over time a number of VCT provisions have limited the definition
of qualifying holding for investment of funds raised by share
issues that take place after a particular date while preserving the
extended definition for investment of money raised by earlier
issues.
The statute has employed a number of different wordings to
identify the relevant funds and investments for each change. For
the purpose of these instructions the term used in the 2006 and
2007 amendments, “protected money”, is used to indicate
the money raised by an issue of shares (or money derived from the
investment of that money) before a relevant change took place.
Investment out of protected money in respect of any relevant
change can continue to be made in accordance with the rules prior
to that change.
The protection applies not only to the money raised directly
by the share issue but also to money which is derived from it
indirectly as a result of the investment of that money.
The provisions in relation to which certain monies are
protected are:
| Provision | Protection of money raised by issues on or after | See |
| Rules requiring a minimum equity content for the investment and outlawing guaranteed loans | 2 July 1997 | VCM62030
VCM62040 |
Amendments of the rules
on qualifying trades adding:
to the list of excluded activities | 17 March 1998 | VCM17140
VCM17150 VCM17170 VCM17160 |
| Amendment of the gross assets test limiting the size of qualifying companies | 6 April 2006 | VCM15100 |
| Introduction of the employee limit test and the limit on the amount of money raised annually by a company (“the tranche test”). | 6 April 2007 | VCM15105
VCM12055 |
