Corporation Tax Act 2010 section 247

Value received by investor during 6 year period: securities or shares

Section 247 deals with the withdrawal of Community Investment Tax Relief where an investor in securities or shares receives value back from the CDFI during the 6 year period, and that value exceeds certain permitted thresholds.

• If an investor who holds securities or shares in a CDFI receives value back (other than insignificant amounts) during the 6 year period, and that value exceeds the permitted level, any CITR attributable to the continuing investment must be withdrawn for all accounting periods.
• No value at all (other than insignificant amounts) may be received during the first 3 years; thereafter, cumulative receipts must not exceed 25% of invested capital before year 5, 50% before year 6, or 75% before the end of the period.
• An amount of insignificant value is one that is no more than £1,000, or if more than £1,000, is insignificant relative to the amount the investor originally subscribed for the securities or shares in the continuing investment.
• Value received is disregarded to the extent that CITR attributable to any loan, securities or shares has already been reduced or withdrawn on account of that same receipt, and separate rules apply where the investor holds more than one investment.