Taxation Laws Amendment (Venture Capital) Act 2002 (136 of 2002)
Schedule 2 Flow-through treatment, and related matters
Income Tax Assessment Act 1936
16 At the end of section 94D
(2) However, a partnership that is a VCLP, an AFOF or a venture capital management partnership cannot be a corporate limited partnership.
Note 1: This subsection can apply without the partnership meeting the applicable registration requirements under the Venture Capital Act 2002. It must be registered under that Act in order to be a VCLP or an AFOF, but it is possible for it to remain registered while the requirements are not met.
Note 2: VCLPs, AFOFs and VCMPs are taxed as ordinary partnerships under Division 5.
Note 3: If the partnerships registration as a VCLP or AFOF is unconditional, some partners share in capital gains and losses from CGT events relating to some investments may be disregarded: see Subdivision 118-F of the Income Tax Assessment Act 1997.
(3) A venture capital management partnership is a limited partnership that:
(a) is a general partner of either or both of the following:
(i) one or more VCLPs;
(ii) one or more AFOFs; and
(b) only carries on activities that are related to being such a general partner.
A limited partnership ceases to be a venture capital management partnership if it ceases to meet the requirements of paragraphs (a) and (b).
Note: In this Act, the term venture capital management partnership is usually abbreviated to VCMP.