ANNEX 1:: MINOR CHANGES IN THE LAW MADE BY THE BILL This change is in taxpayers’ favour in principle. But it is expected to have no practical effect as it is in line with current practice.
Change 43: EIS, VCT and share loss relief: the trading requirement: sections 137, 181, 194, 290 and 305, Schedule 1 (section 576B of ICTA) and Schedule 2Parts 6 and 8 (excluded activities: leasing of ships)
This change extends the scope of EIS and VCT relief by relaxing the way in which a restriction relating to the leasing of ships operates. This affects in a minor way the rules that determine whether a parent company and its group meets the trading requirement.
To meet the trading requirement, the business of the group must not consist wholly or as to a substantial part in carrying on non-qualifying activities. Non-qualifying activities consist of activities carried on otherwise than in the course of a trade and excluded activities.
Leasing is an excluded activity but there is an exception or let-out for certain types of ship leasing. The change concerns the way that this let-out is reflected in sections 137, 181, and 290 of this Act.