HMRC internal manual

Venture Capital Schemes Manual

VCT returns: identifying investments funding by different issues of shares: protected money

You should check the other guidance available on GOV.UK from HMRC as Brexit updates to those pages are being prioritised before manuals.

Over time a number of VCT provisions have limited the definition of qualifying holding for investment of funds raised by share issues that take place after a particular date while preserving the extended definition for investment of money raised by earlier issues.

The statute has employed a number of different wordings to identify the relevant funds and investments for each change. For the purpose of this guidance the term used in the 2006 and 2007 amendments, ‘protected money’, is used to indicate the money raised by an issue of shares (or money derived from the investment of that money) before a relevant change took place.

Investment out of protected money in respect of any relevant change can continue to be made in accordance with the rules prior to that change up to and including 5 April 2018.

The protection applied not only to the money raised directly by the share issue but also to money which is derived from it indirectly as a result of the investment of that money.

The provisions in relation to which certain monies were protected are listed at VCM55020