Corporation Tax Act 2010 section 227

Conditions to be met in relation to securities

Section 227 sets out the two conditions that must be satisfied in relation to securities for the purposes of qualifying for community development finance institution (CDFI) tax relief.

• Securities must be subscribed for wholly in cash and fully paid for on the investment date.
• Securities must not carry any present or future right to be redeemed within the 5-year period.
• Securities must not carry any present or future right to be converted into or exchanged for a loan, securities, shares or other rights that are redeemable within that 5-year period.
• Securities are not treated as fully paid for if there is any undertaking to pay cash to the CDFI at a future date in connection with acquiring the securities.