Taxation of Chargeable Gains Act 1992 Schedule 7AD paragraph 9

Investment in other venture capital investment partnerships

Paragraph 9 deals with the treatment of capital contributions made by one venture capital investment partnership (VCIP) into another VCIP, and the Treasury's power to make regulations governing gains arising from such arrangements.

• A capital contribution to another VCIP is treated as an investment in unquoted shares or securities for the purpose of qualifying as a VCIP.
• The Treasury may make regulations dealing with gains on disposal of relevant assets by such a partnership, replacing the standard rules in paragraphs 3 to 8 of the Schedule.
• Any regulations made may apply to accounting periods for which the Schedule is in effect, in accordance with the commencement and transitional provisions.
• This provision ensures that layered VCIP structures — where one partnership invests into another — remain within the scope of the special tax treatment for insurance company gains.