(1)Where for any chargeable period a first-year allowance falls to be made to a person carrying on a trade in respect of expenditure incurred by him on the provision of a ship, that person may, by notice given to the inspector not later than two years after the end of the period—
(a)require the postponement of the whole allowance or, in the case of a company, disclaim it, or
(b)require that the amount of the allowance be reduced to an amount specified in the notice, or
(c)require the postponement of so much of the allowance as is so specified,
and a notice which contains a requirement under paragraph (b) above may also contain a requirement under paragraph (c) above with respect to the reduced amount of the allowance.
(2)Where a notice has been given under subsection (1) above requiring the postponement of the whole or part of any first-year allowance—
(a)the allowance shall, as the case may require, be withheld or withdrawn, or partially withheld or withdrawn, and
(b)so much of the expenditure as is equal to the whole allowance shall be disregarded for all the purposes of sections 24, 25 and 26 except for the purposes of sections 24(6) and 26(1) and (2), and
(c)subject to section 47(7)(a), the person giving the notice may claim the amount withheld or withdrawn as a first-year allowance for any subsequent chargeable period in which he carries on the trade, or may claim first-year allowances not exceeding that amount in the aggregate for any two or more such periods.
(3)All such assessments and adjustments of assessments shall be made as may be necessary to give effect to the provisions of this section.
(4)An allowance which is postponed by virtue of this section shall not by reason only of the postponement fall within the references to allowances or amounts carried forward from an earlier year or period in sections 383(5)(d), 388(7) and 403(3) of the principal Act (loss relief and group relief).
(5)In any case where a notice under subsection (1) above contains requirements under both paragraphs (b) and (c) of that subsection, any reference in subsections (2) to (4) above to the first-year allowance is a reference to the reduced amount of that allowance as specified in the notice.