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HMRC internal manual

Venture Capital Schemes Manual

From
HM Revenue & Customs
Updated
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VCT: VCT approval: value of a holding

ITA07/S278

For the purposes of the 70% qualifying holding condition (see VCM54080 onwards), the 30% or 70% eligible shares condition (see VCM54140) and the 15% holding limit condition (see VCM54070), the value of any holding of investments is its value when acquired unless:

  • the holding is added to, or
  • any payment is made in discharge, in whole or in part, of any obligation attached to the holding which increases the value of the holding (for example, for partly-paid shares, where a second or subsequent instalment is paid).

Where a holding is added to, or such a payment is made, the value of the holding, for the purposes of the tests, is its value after the most recent addition or payment.

A holding is only revalued if it is added to by a further holding of investments of the same description. So if a holding is of ordinary shares and the VCT later acquires preferential shares, the ordinary shares will not be revalued.