Section 257LA | Condition that the amount invested must have been paid over

(1)So far as the investment is in shares—

(a)the shares must be subscribed for wholly in cash, and

(b)must be fully paid up at the time they are issued.

(2)If the investment, so far as it is in qualifying debt investments, involves making—

(a)the only advance covered by the debenture or debentures concerned, or

(b)one of multiple advances covered by the debenture or debentures concerned,

the full amount of that advance must have been advanced wholly in cash by the time the investment is made.

(3)For the purposes of this section—

(a)shares are not fully paid up, or

(b)the full nominal amount of qualifying debt investments has not been advanced,

if there is any undertaking to pay cash to any person at a future time in respect of the acquisition of the shares or investments.

(4)For the purposes of subsection (2) “debenture” includes any instrument creating or acknowledging indebtedness.