Taxation of Chargeable Gains Act 1992 Schedule 7AD paragraph 3

Interest in relevant assets of partnership treated as single asset

Paragraph 3 of Schedule 7AD sets out how an insurance company's interest in the relevant assets of a venture capital investment partnership is recharacterised as a single asset for capital gains purposes, replacing the normal partnership rules.

• The normal partnership rules under section 59 do not apply to charge the insurance company on its share of gains arising on each separate disposal of the partnership's relevant assets.
• Instead, the company's entire interest in the partnership's relevant assets is treated as one single asset, deemed to have been acquired when the company joined the partnership.
• The relevant assets of the partnership are the shares and securities it holds, but qualifying corporate bonds are excluded.
• The Schedule does not affect how section 59 operates for partners who are not insurance companies carrying on long-term business or who are not limited partners, and it does not impose any tax liability on the partnership itself.