Document ID: chunk:federal_register_of_legislation:C2004A01073:clause:1_6:p1
Version: federal_register_of_legislation:C2004A01073
Segment Type: clause
Provision Reference: sch 1 cl 6 (pt 1/10)
Character Range: 7001–10087

6  After Subdivision 118‑E
Insert:

Subdivision 118‑F—Venture capital investment

Guide to Subdivision 118‑F

118‑400  What this Subdivision is about

      Some foreign residents disregard capital gains and capital losses from CGT events that relate to investments, in Australian companies (and in some cases foreign holding companies), that meet the requirements of this Subdivision.
      These investments are made:

                (a) through limited partnerships, known as venture capital limited partnerships, that are unconditionally registered under Part 2 of the Venture Capital Act 2002; or
                (b) through limited partnerships, known as Australian venture capital funds of funds, that are unconditionally registered under that Part; or
                (c) directly by foreign residents who are registered under Part 3 of that Act.
Note: Registration of a limited partnership under Part 2 of that Act also leads to its income and losses being assessed under Division 5 of Part III of the Income Tax Assessment Act 1936 on the basis that it is a partnership.

 This is an exception to the general rule, under Division 5A of that Part, that limited partnerships are assessed as companies. For this purpose, registration does not need to be unconditional.

Table of sections

Operative provisions

118‑405 Exemption for certain foreign venture capital investments through venture capital limited partnerships
118‑410 Exemption for certain foreign venture capital investments through Australian venture capital funds of funds
118‑415 Exemption for certain venture capital investments by foreign residents
118‑420 Meaning of eligible venture capital partner etc.
118‑425 Meaning of eligible venture capital investment
118‑430 Meaning of at risk
118‑435 Special rule relating to investment in non‑resident holding companies
118‑440 Meaning of permitted entity value
118‑445 Meaning of committed capital

[This is the end of the Guide.]

Operative provisions

118‑405  Exemption for certain foreign venture capital investments through venture capital limited partnerships

General

 (1) All of your share in a *capital gain or a *capital loss from a *CGT event is disregarded if:
 (a) you are an *eligible venture capital partner in a *limited partnership; and
 (b) the CGT event relates to an investment that the partnership made that is an *eligible venture capital investment; and
 (c) when the partnership made the investment, the partnership:
 (i) was a *venture capital limited partnership that was *unconditionally registered; and
 (ii) met all of the *registration requirements of a VCLP that are not *investment registration requirements; and
 (d) at the time of the CGT event, the partnership:
 (i) owned the investment; and
 (ii) had owned the investment for at least 12 months; and
 (iii) was a venture capital limited partnership that was unconditionally registered; and
 (iv) in the case of a capital gain—met all of the registration requirements of a VCLP that are not investment registration requirements.

Note: The registration requirements of