VCT: VCT qualifying holdings: maximum qualifying investment
The amount of a holding in a company which is part of the VCT’s qualifying holdings is restricted if the amount which the VCT invests in that company within a certain period exceeds an amount termed the maximum qualifying investment. The period in question is the period which commences six months before the date of the issue of that holding or on the previous 6 April, whichever is earlier, and ends with that issue.
The maximum qualifying investment is normally £1m, but this is reduced if at the time of the issue the company invested in, or any of its subsidiaries, is a member of a partnership or a party to a joint venture. In these circumstances the limit is £1m divided by the number of companies involved in the partnership or joint venture.
As regards what constitutes a partnership or joint venture, see BIM72000 onwards.
This requirement does not apply in respect of holdings issued on or after 6 April 2012, other than where the company invested in is a member of a partnership or a party to a joint venture.