Taxes Consolidation Act 1997 section 600I

Anti-avoidance: qualifying investor

Section 600I is an anti-avoidance provision that prevents an individual from being a qualifying investor for the purposes of angel investor relief where there are tax avoidance arrangements involving connected companies.

• This section targets arrangements designed to circumvent the requirement that a qualifying investor must not be connected with the company in which they invest.
• Where an individual subscribes for shares in a company with which they are not connected, they will nevertheless be treated as connected with that company if the subscription forms part of a wider arrangement.
• The arrangement in question is one that provides for another person to subscribe for shares in a different company with which the individual, or any other party to the arrangement, is connected.
• The effect is that the individual will not qualify for angel investor relief in respect of shares acquired under such an arrangement.