Income Tax Act 2007 section 90

Meaning of "company", "shares" and "research and development" in Part 6

Section 90 provides transitional rules for how the terms "company", "shares" and "research and development" are to be interpreted for venture capital trust (VCT) purposes where investments were held before 6 April 2007 or shares were issued before 6 April 2000.

• Where a VCT held investments in an entity before 6 April 2007 and there is a mismatch between the old ICTA rules and the new Part 6 rules as to whether that entity counts as a "company", the old ICTA definition continues to apply until the VCT disposes of those investments.
• Similarly, where investments held before 6 April 2007 are treated as "shares" under one set of rules but not the other, the old ICTA definition governs the position until the VCT no longer holds those investments.
• The ICTA provisions referred to are section 842AA of ICTA (VCT approvals) and Schedule 28B to ICTA (qualifying holdings); the corresponding Part 6 provisions are Chapters 3 and 4 of Part 6.
• For shares issued before 6 April 2000, "research and development" is given a narrower meaning — it covers only activity intended to produce a patentable invention (within the meaning of the Patents Act 1977) or a computer program.