Finance Act 1999 (c. 16)

(The document as of February, 2008)

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(8) An order made under subsection (9) of that section for the purposes of subsection (2)(c) (as inserted by subsection (3)(b) above) may have effect retrospectively in relation to such times falling on or after that date as may be specified in the order.

57 Aggregation of money gifts for relief in poor countries

(1) Section 48 of the [1998 c. 36.] Finance Act 1998 (gifts of money made for relief in poor countries) shall have effect, and be deemed always to have had effect, with the following amendments.

(2) In subsection (4) (aggregated small gifts to be treated as a single payment made at the time of the last of them), after "that section" there shall be inserted "(but subject to subsection (4A) below)".

(3) After that subsection there shall be inserted the following subsection--

" (4A) Subsection (10) of section 25 of the [1990 c. 29.] Finance Act 1990 (receipts of gifts by a charity to be treated as payments of grossed-up amounts after deduction of basic rate income tax) shall have effect where--

(a) any aggregated gifts are treated under this section as a single qualifying donation made to a charity, and

(b) the aggregated gifts include gifts made in different years of assessment,

as if that single qualifying donation had been received by the charity in the year of assessment in which the first of the aggregated gifts was made and as if that were the relevant year of assessment for the purposes of that subsection. "

Education and training

58 Employees seconded to educational establishments

(1) Section 86 of the Taxes Act 1988 (employees seconded to charities and educational establishments) shall be amended as follows.

(2) In subsection (3) (relief for expenditure attributable to the employment before 1st April 1997 of employees seconded to educational establishments), the words "and before 1st April 1997" shall be omitted.

(3) In that subsection, for paragraphs (a) to (c) there shall be substituted--

" (a) in England and Wales, any body falling within subsection (4) below;

(b) in Scotland, any body falling within subsection (5) below;

(4) After subsection (3) there shall be inserted--

" (4) A body falls within this subsection if it is--

(a) a local education authority;

(b) an educational institution maintained or otherwise supported by such an authority (including a grant-maintained school or a grant-maintained special school within the meaning of the [1996 c. 56.] Education Act 1996);

(c) an independent school, within the meaning of the Education Act 1996, whose registration under section 465 of that Act is final; or

(d) an institution within the further education sector, or the higher education sector, within the meaning of the [1992 c. 13.] Further and Higher Education Act 1992.

(5) A body falls within this subsection if it is--

(a) an education authority;

(b) an educational establishment managed by such an authority within the meaning of the [1980 c. 44.] Education (Scotland) Act 1980 ("the 1980 Act");

(d) a self-governing school within the meaning of the [1989 c. 39.] Self-Governing Schools etc. (Scotland) Act 1989;

(e) an independent school within the meaning of the 1980 Act;

(f) a central institution within the meaning of the 1980 Act;

(g) an institution within the higher education sector within the meaning of section 56(2) of the [1992 c. 37.] Further and Higher Education (Scotland) Act 1992; or

(h) a college of further education within the meaning of section 36(1) of that Act.

(6) A body falls within this subsection if it is--

(a) an education or library board within the meaning of the [S.I. 1986/594 (N.I. 3.] Education and Libraries (Northern Ireland) Order 1986;

(b) a college of education or a controlled, maintained, grant-maintained integrated, controlled integrated, voluntary or independent school within the meaning of that Order; or

(c) an institution of further education within the meaning of the [S.I. 1997/1772 (N.I. 15.] Further Education (Northern Ireland) Order 1997. "

(5) The amendment made by subsection (2) above shall be deemed always to have had effect.

(6) The amendments made by subsections (3) and (4) above have effect for the year 1999-00 and subsequent years of assessment.

59 Phasing out of vocational training relief

(1) For subsection (2) of section 32 of the [1991 c. 31] Finance Act 1991 (vocational training relief) there shall be substituted--

" (2) The individual shall be entitled to relief under this subsection in respect of the payment for the year of assessment in which it is made; but relief under this subsection shall be given only on a claim made for the purpose, except where subsections (3) to (5) below apply.

(2A) Where an individual is entitled to relief under subsection (2) above in respect of any payment made in a year of assessment, the amount of his liability for that year to income tax on his total income shall be the amount to which he would be liable apart from this section less whichever is the smaller of--

(a) the amount which is equal to such percentage of the amount of the payment as is the basic rate for the year; and

(b) the amount which reduces his liability to nil.

(2B) In determining for the purposes of subsection (2A) above the amount of income tax to which a person would be liable apart from this section, no account shall be taken of--

(a) any income tax reduction under Chapter I of Part VII of the Taxes Act 1988 or under section 347B of that Act;

(b) any income tax reduction under section 353(1A) of the Taxes Act 1988;

(c) any relief by way of a reduction of liability to tax which is given in accordance with any arrangements having effect by virtue of section 788 of the Taxes Act 1988 or by way of a credit under section 790(1) of that Act;

(d) any tax at the basic rate on so much of that person's income as is income the income tax on which he is entitled to charge against any other person or to deduct, retain or satisfy out of any payment. "

(2) That section and section 33 of that Act (provisions supplementary to section 32) shall cease to have effect.

(3) In this section--

(a) subsection (1) has effect in relation to payments made on or after 6th April 1999; and

(b) subsection (2) shall have effect in relation to payments made on or after such date after 6th April 2000 as the Treasury may by order appoint.

60 Student loans: certain interest to be disregarded

The following section shall be inserted after section 331 of the Taxes Act 1988--

" 331A Student loans: certain interest to be disregarded

(1) If--

(a) a loan is made to a person under any of the relevant student loan provisions,

(b) an amount is recovered from him in respect of the loan,

(d) interest is paid to him in respect of the amount repaid,

the interest shall be disregarded for all purposes of income tax.

(2) For the purposes of subsection (1) above the relevant student loan provisions are--

(a) section 22 of the [1998 c. 30] Teaching and Higher Education Act 1998;

(b) section 73(f) of the [1980 c. 44] Education (Scotland) Act 1980;

Various other reliefs etc.

61 Class 1B National Insurance contributions

(1) In section 617 of the Taxes Act 1988 (social security benefits and contributions), in subsection (4), for "or Class 1A contribution" there shall be substituted ", a Class 1A contribution or a Class 1B contribution".

(2) Subsection (1) above has effect in relation to contributions paid on or after 6th April 1999.

62 Expenditure on film production and acquisition

In subsection (2)(a) of section 48 of [1997 c. 58.] the Finance (No. 2) Act 1997 (which provides for favourable tax treatment for certain expenditure on film production and acquisition incurred on or after 2nd July 1997 and before 2nd July 2000), for "2nd July 2000" there shall be substituted "2nd July 2002".

63 Treatment of transfer fees under existing contracts

(1) Subject to subsection (2) below, where--

(a) a contract is or has been entered into by a football or other sports club to secure the services of a player; and

(b) the contract is or was entered into before the beginning of the first accounting period of the club in relation to which a relevant financial reporting standard has effect (whether by virtue of the adoption of the standard by the club or otherwise),

nothing in the standard shall be taken to affect the manner in which any fee required to be paid by the club under the contract may be taken into account in computing the club's profits to be charged under Case I of Schedule D.

(2) Subsection (1) above shall not apply if the club so elects by a notice given to an officer of the Board within the period of two years beginning immediately after the accounting period described in subsection (1)(b) above.

(3) The relevant financial reporting standards are--

(a) Financial Reporting Standard 10 issued by the Accounting Standards Board on 4th December 1997; and

(b) Financial Reporting Standard for Smaller Entities issued by that Board on 10th December 1998.

(4) All such adjustments shall be made (whether by way of assessment, amendment of an assessment, repayment of tax or otherwise) as may be necessary to give effect to the provisions of this section.

(5) Subsection (4) above has effect notwithstanding any time limits relating to the making or amendment of an assessment for any accounting period.

Settlements

64 Income of unmarried child of settlor

(1) In section 660B(1) of the Taxes Act 1988 (circumstances in which income arising under settlement treated as that of settlor), before "is paid to or for the benefit of an unmarried minor child of the settlor" insert "(a)" and after those words insert-- " , or

(b) would otherwise be treated (apart from this section) as income of an unmarried minor child of the settlor, " .

(2) In subsection (3) of that section (meaning of available retained or accumulated income), for paragraphs (a) and (b) substitute--

" (a) treated as income of the settlor, or

(b) paid (whether as income or capital) to or for the benefit of, or otherwise treated as the income of, a beneficiary other than an unmarried minor child of the settlor, or

(bb) treated as the income of an unmarried minor child of the settlor, and subject to tax, in any of the years 1995-96, 1996-97 or 1997-98, or " .

(3) After that subsection insert--

" (3A) For the purposes of subsection (3)(bb) above--

(a) the amount of a child's income that is subject to tax in a year of assessment is the amount ("the taxable amount") by which the child's total income for income tax purposes exceeds the aggregate amount of allowances that may be set against it; and

(b) income arising under the settlement that is treated as income of the child is subject to tax to the extent that it does not exceed the taxable amount.

In this subsection "allowance" includes any deduction allowed against total income. " .

(4) For subsection (5) of that section substitute--

" (5) If in any year of assessment the aggregate amount of a child's relevant settlement income does not exceed £100, subsection (1) does not apply in relation to that income.

A child's `relevant settlement income' means income paid to or for the benefit of, or otherwise treated as income of, that child which apart from this subsection would be treated as income of the settlor under subsection (1). " .

(5) The amendment in subsection (1) above has effect in relation to--

(a) income arising under a settlement made or entered into on or after 9th March 1999, and

(b) income arising under a settlement made or entered into before that date so far as it arises directly or indirectly from funds provided on or after that date;

and the amendment in subsection (4) above has effect accordingly.

Any apportionment required for the purposes of paragraph (b) shall be made on a just and reasonable basis.

(6) The amendments in subsections (2) and (3) above have effect in relation to any payment within subsection (2) of section 660B of the Taxes Act 1988 made on or after 9th March 1999.

In relation to such a payment those amendments apply whenever the facts mentioned in subsection (3) of that section occurred.

(7) In section 660E of the Taxes Act 1988 (application of provisions to settlements by two or more settlors), in subsection (3) (which refers to section 660B) for the words from "in relation to" to "child of the settlor" substitute "in relation to a child of the settlor".

Securities and investments

65 Relevant discounted securities

(1) In paragraph 3 of Schedule 13 to the [1996 c. 8.] Finance Act 1996 (meaning of "relevant discounted security"), for sub-paragraph (1) there shall be substituted the following sub-paragraphs--

" (1) Subject to the following provisions of this paragraph and paragraph 14(1) below, in this Schedule "relevant discounted security" means any security which (whenever issued) is such that, taking the security as at the time of its issue, the amount payable on redemption--

(a) on maturity, or

(b) in the case of a security of which there may be a redemption before maturity, on at least one of the occasions on which it may be redeemed,

is or would be an amount involving a deep gain, or might be an amount which would involve a deep gain.

(1A) The occasions that are to be taken into account for the purpose of determining whether a security is a relevant discounted security by virtue of sub-paragraph (1)(b) above shall not include any of the following occasions on which it may be redeemed, that is to say--

(a) any occasion not falling within sub-paragraph (1C) below on which there may be a redemption otherwise than at the option of the person who holds the security;

(b) in a case where a redemption may occur as a result of the exercise of an option that is exercisable--

(i) only on the occurrence of an event adversely affecting the holder, or

(ii) only on the occurrence of a default by any person,

any occasion on which that option is unlikely (judged as at the time of the security's issue) to be exercisable;

but nothing in this sub-paragraph shall require an occasion on which a security may be redeemed to be disregarded by reason only that it is or may be an occasion that coincides with an occasion mentioned in this sub-paragraph.

(1B) In sub-paragraph (1A) above "event adversely affecting the holder", in relation to a security, means an event which (judged as at the time of the security's issue) is such that, if it occurred and there were no provision for redemption, the interests of the person holding the security at the time of the event would be likely to be adversely affected.

(1C) An occasion on which there may be a redemption of a security falls within this sub-paragraph if--

(a) the security is a security issued to a person connected with the issuer; or

(b) the obtaining of a tax advantage by any person is the main benefit, or one of the main benefits, that might have been expected to accrue from the provision in accordance with which it may be redeemed on that occasion.

(1D) In sub-paragraph (1C) above "tax advantage" has the meaning given by section 709(1) of the Taxes Act 1988.

(1E) Subject to sub-paragraph (1F) below, where a security which is not a relevant discounted security but which would have been such a security if it had been issued to a person connected with the issuer--

(a) is acquired by a person who is so connected, or

(b) is held by a person who becomes so connected,

this Schedule shall have effect, in relation to times falling at or after the time of the acquisition or, as the case may be, the time when that person became so connected, as if the security were a relevant discounted security.

(1F) Where a security which--

(a) is a relevant discounted security, but

(b) would not be such a security but for sub-paragraph (1C)(a) or (1E) above,

is acquired by a person who is not connected with the issuer, this Schedule shall have effect, in relation to that person, as if the security ceased to be a relevant discounted security at the time of the acquisition. "

(2) After sub-paragraph (2) of that paragraph there shall be inserted the following sub-paragraphs--

" (2A) Nothing in sub-paragraph (2)(c) above shall prevent a security that would have been a relevant discounted security if it had been issued to a person connected with the issuer from being treated as a relevant discounted security by virtue of sub-paragraph (1E) above.

(2B) Nothing in sub-paragraph (2)(f) above shall prevent a security from being treated as a relevant discounted security by virtue of sub-paragraph (1C)(a) or (1E) above. "

(3) Sub-paragraph (5) of that paragraph shall cease to have effect.

(4) After sub-paragraph (6) of that paragraph there shall be inserted the following sub-paragraphs--

" (7) Section 839 of the Taxes Act 1988 (connected persons) applies for the purposes of this paragraph.

(8) In determining for the purposes of sub-paragraph (1C), (1E), (1F) or (2A) above whether a person is or becomes connected with the issuer, no account shall be taken of--

(a) the security mentioned in that sub-paragraph; or

(b) any security issued under the same prospectus as that security. "

(5) In paragraph 10 of that Schedule (issue of securities in separate tranches), after sub-paragraph (3) there shall be inserted the following sub-paragraph--

" (4) For the purpose of determining whether a security held by a person who is not connected with the issuer is a relevant discounted security by virtue of this paragraph, a security which--

(a) is a relevant discounted security, but

(b) would not be such a security but for paragraph 3(1C)(a) or (1E) above,

shall be assumed not to be a security falling within sub-paragraph (1)(b) above. "

(6) In paragraph 13 of that Schedule (excluded indexed securities), after sub-paragraph (8) there shall be inserted the following sub-paragraph--

" (9) In this paragraph references to redemption, in relation to a security, do not include references to redemption of the security on any such occasion as, by reason of sub-paragraph (1A) of paragraph 3 above, is not to be taken into account for the purpose of determining whether the security is a relevant discounted security by virtue of sub-paragraph (1)(b) of that paragraph. "

(7) In section 92 of that Act, after subsection (6) there shall be inserted the following subsections--

" (7) Where an asset representing a creditor relationship of a company--

(a) ceases at any time to be an asset to which this section applies, but

(b) does not cease at that time to represent a creditor relationship of that company,

the company shall be deemed for the purposes of the [1992 c. 12.] Taxation of Chargeable Gains Act 1992 and this Chapter to have disposed of the asset immediately before that time for the relevant consideration, and to have re-acquired it immediately after that time for the relevant consideration.

(8) Any deemed disposal and re-acquisition under subsection (7) above shall be treated for the purposes of that Act of 1992 as a transaction in the case of which--

(a) sections 127 to 130 of that Act would apply, apart from the provisions of section 116 of that Act, by virtue of any provision of Chapter II of Part IV of that Act;

(b) the asset in question represents both the original shares and the new holding for the purposes of those sections;

(9) Subject to subsection (10) below, in subsections (7) and (8) above "the relevant consideration", in relation to an asset, means the amount that would have been taken, in accordance with the relevant accounting method, to be the value of the asset at the time of its deemed disposal if that method had been applied to the asset for tax purposes at all times until then.

(10) Subsection (5) above shall not apply in the case of a deemed disposal and re-acquisition under subsection (7) above; but the amount of the relevant consideration in such a case shall be treated for the purposes of the Taxation of Chargeable Gains Act 1992 as reduced by so much (if any) of the amount mentioned in subsection (9) above as is referable to interest which--

(a) is not paid or payable to the company before the time of the deemed disposal; but

(b) is interest falling to be brought into account under subsections (2) and (3) above as having accrued before that time.

(11) In subsection (9) above "the relevant accounting method", in relation to an asset representing a creditor relationship of a company, means the accounting method which, for the accounting period of that company in which the deemed re-acquisition takes place, is used as respects that asset and the part of that accounting period beginning with the deemed re-acquisition. "

(8) Subject to subsections (9) to (12) below, subsections (1) to (7) above have effect in relation to--

(a) any transfer of a security on or after 15th February 1999; or

(b) any occasion on or after that date on which a person holding a security becomes entitled to any payment on its redemption.

(9) For the purposes of section 92 of that Act, subsections (1) to (7) above--

(a) have effect in relation to any accounting period of a company ending on or after 15th February 1999; but

(b) do not affect any amount falling to be brought into account in respect of any disposal (in whole or in part) of an asset representing a creditor relationship if the disposal was one completed before that day.

(10) For the purposes of paragraphs 17 and 18 of Schedule 9 to that Act, subsections (1) to (7) above--

(a) have effect in relation to any accounting period of a company ending on or after 15th February 1999; but

(b) do not affect any amount falling to be brought into account in respect of a security representing a debtor relationship of a company if, on that day, the company was no longer subject to any liability under the relationship.

(11) For the purposes of sections 117(2AA) and 251(8) of the [1992 c. 12.] Taxation of Chargeable Gains Act 1992, subsections (1) to (7) above have effect in relation to any disposal (in whole or in part) of an asset on or after 15th February 1999.

(12) For the purposes of subsection (1)(c) of section 254 of that Act (which, notwithstanding its repeal by the [1998 c. 36.] Finance Act 1998, continues to have effect in relation to loans made before 17th March 1998), subsections (1) to (7) above have effect in relation to any claim made on or after 15th February 1999.

66 Qualifying corporate bonds: provision consequential on s. 65

(1) This section applies where--

(a) before 15th February 1999 there occurred a transaction ("the relevant transaction") to which sections 127 to 130 of the Taxation of Chargeable Gains Act 1992 applied; and

(b) the new holding (within the meaning given by section 126 of that Act) consisted of or included something ("the new asset") that--

(i) did not fall to be treated as a qualifying corporate bond in relation to the relevant transaction, but

(ii) by virtue of section 65 above, does fall to be so treated in relation to a disposal on or after 15th February 1999.

(2) Section 116 of the Taxation of Chargeable Gains Act 1992 (reorganisations etc. involving qualifying corporate bonds) shall have effect in relation to any disposal of the whole or part of the new asset on or after 15th February 1999 as if--

(a) there had been a transaction ("the subsequent transaction") by which the person holding the new asset had disposed of it and immediately re-acquired it;

(b) the subsequent transaction had occurred at the time mentioned in subsection (3) below;

(d) the subsequent transaction had been a transaction to which section 127 of that Act would have applied but for section 116(5) of that Act.

(3) That time is--

(a) where the relevant transaction took place before 5th April 1996, that date;

(b) where the relevant transaction took place on or after that date, immediately after the relevant transaction.

67 Deep discount and deep gain securities

(1) In paragraph 19 of Schedule 15 to the [1996 c. 8.] Finance Act 1996 (loan relationships: savings and transitional provisions), after sub-paragraph (3) there shall be inserted the following sub-paragraph--

" (3A) Any income that is treated as arising at the time mentioned in subsection (5) of that section, as it applies by virtue of sub-paragraph (3) above, shall be brought into account as a non-trading credit given for the purposes of this Chapter for the accounting period in which that time falls. "

(2) In paragraph 20 of that Schedule, after sub-paragraph (2) there shall be inserted the following sub-paragraph--

" (2A) Any income that is treated as arising on the day mentioned in subsection (5) of that section, as it applies by virtue of sub-paragraph (2) above, shall be brought into account as a non-trading credit given for the purposes of this Chapter for the accounting period in which that day falls. "

(3) In paragraph 19(7) of that Schedule, for paragraph (b) there shall be substituted the following paragraph--

" (b) the company did not make any disposal of that security on that date, " .

(4) In subsection (5)(c) of sections 64 and 65 of the [1993 c. 34.] Finance Act 1993 (which have effect, notwithstanding their repeal by the Finance Act 1996, in relation to deep discount and deep gain securities held on and after 31st March 1996), for "it is transferred by the creditor company" there shall be substituted "the creditor company makes a disposal of the security".

(5) After subsection (5) of section 65 of that Act there shall be inserted the following subsection--

" (5A) There is a disposal of a security for the purposes of subsection (5)(c) above if there would be such a disposal for the purposes of the [1992 c. 12.] Taxation of Chargeable Gains Act 1992. "

(6) Subsections (1) and (2) above apply in relation to income treated as arising on or after 15th February 1999.

(7) Subsection (3) above applies in any case where the day mentioned in paragraph 19(9) of Schedule 15 to the Finance Act 1996 falls on or after 15th February 1999.

(8) Subsections (4) and (5) above apply for determining whether a time on or after 15th February 1999--

(a) is a time falling within section 64(5)(c) of the Finance Act 1993; or

(b) is on a day falling within section 65(5)(c) of that Act.

68 Court common investment funds

(1) After section 469 of the Taxes Act 1988 there shall be inserted the following section--

" 469A Court common investment funds

(1) The Tax Acts shall have effect in relation to any common investment fund established under section 42 of the [1982 c. 53.] Administration of Justice Act 1982 (common investment funds for money paid into court) as if--

(a) the fund were an authorised unit trust;

(b) the person who is for the time being the investment manager of the fund were the trustee of that authorised unit trust; and

(c) the persons whose interests entitle them, as against the Accountant General, to share in the fund's investments were the unit holders in that authorised unit trust.

(2) In this section "the Accountant General" means (subject to subsection (3) below) the Accountant General of the Supreme Court of Judicature in England and Wales or the Accountant General of the Supreme Court of Judicature of Northern Ireland.

(3) Where in the case of any common investment fund a person other than the Accountant General is authorised by the Lord Chancellor to hold shares in the fund, the reference in subsection (1)(c) above to the Accountant General shall include a reference to that other person. "

(2) Section 328 of the Taxes Act 1988 (agreements with the Board about the taxation regime for common investment funds) shall cease to have effect.

(3) Subsections (1) and (2) above have effect in relation to--

(a) any income arising to a common investment fund on or after 6th April 1999; and

(b) any distribution made by such a fund for a distribution period beginning on or after that date.

(4) For the purposes of the Tax Acts where any common investment fund was in existence on 5th April 1999--

(a) the distribution period of that fund which was current on that date for the purposes of section 469 of the Taxes Act 1988 shall be taken to have ended with that date; and

(b) the fund's first accounting period for the purposes of corporation tax, and its first distribution period for the purposes of the enactments relating to authorised unit trusts, shall each be taken to have begun with 6th April 1999.

(5) In this section "common investment fund" means any common investment fund established under section 42 of the Administration of Justice Act 1982.

Venture capital trusts

69 Company restructuring and convertible securities

(1) The Taxes Act 1988 shall be amended as follows.

(2) In Schedule 28B (requirements to be satisfied by qualifying investments of VCTs), after paragraph 10B there shall be inserted the following paragraphs--

" Acquisitions for restructuring purposes

10C (1) This paragraph applies where--

(a) arrangements are made for a company ("the new company") to acquire all the shares ("old shares") in another company ("the old company");

(b) the acquisition provided for by the arrangements falls within sub-paragraph (2) below; and

(2) An acquisition of shares falls within this sub-paragraph if--

(a) the consideration for the old shares consists wholly of the issue of shares ("new shares") in the new company;

(b) new shares are issued in consideration of old shares only at times when there are no issued shares in the new company other than subscriber shares and new shares previously issued in consideration of old shares;

(c) the consideration for new shares of each description consists wholly of old shares of the corresponding description; and

(d) new shares of each description are issued to the holders of old shares of the corresponding description in respect of, and in proportion to, their holdings.

(3) For the purposes of sub-paragraph (1)(c) above an approval notification is one which, on an application by either the old company or the new company, is given to the applicant company and states that the Board are satisfied that the exchange of shares under the arrangements--

(a) will be effected for bona fide commercial reasons; and

(b) will not form part of any such scheme or arrangements as are mentioned in section 137(1) of the 1992 Act.

(4) If the requirements of paragraph 3 above were satisfied in relation to the old company and any old shares immediately before the beginning of the period for giving effect to the arrangements, then (to the extent that it would not otherwise be the case) those requirements shall be deemed to be satisfied in relation to the new company and the matching new shares at all times which--

(a) fall in that period; and

(b) do not fall after a time when (apart from the arrangements) those requirements would have ceased by virtue of--

(i) sub-paragraph (4) or (5) of that paragraph, or

(ii) any cessation of a trade by any company,

to be satisfied in relation to the old company and the matching old shares.

(5) For the purposes of paragraph 3 above the period of two years mentioned in sub-paragraph (4) of that paragraph shall be deemed, in the case of any new shares, to expire at the same time as it would have expired (or by virtue of this sub-paragraph would have been deemed to expire) in the case of the matching old shares.

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