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HMRC internal manual

Venture Capital Schemes Manual

VCT: VCT qualifying holdings: ceasing to meet requirements because of administration or receivership


Effect of administration or receivership

When a company goes into administration or receivership its directors lose most of their powers. The person who is able to exercise those powers (usually an ‘administrative receiver’) may act in a way which would cause the company to cease to satisfy one or more of the conditions described at VCM55090 or VCM55110 - for example, they may have to sell the company’s assets, with the result that the company is unable to carry on a trade.

Any failure to satisfy one of those requirements which is due merely to the company’s having been put into administration or receivership is to be ignored, provided everything done as a consequence of that is done for commercial reasons and is not part of a scheme or arrangement aimed at avoiding tax.