Finance Act 1990

9(1)For the purposes of this Schedule the yield to redemption for a redemption period is a rate (expressed as a percentage) such that if a sum equal to the relevant amount were to be invested at that rate on the assumption that—

(a)the rate would be applied on a compounding basis at the end of each relevant income period, and

(b)the amount of any interest payable in respect of a relevant income period would be deducted after applying the rate,

the value of that sum on the relevant redemption day would be equal to the amount payable on redemption of the security on that day under the relevant redemption provision.

(2)For the purposes of this paragraph the relevant amount is the issue price, in a case where the redemption period concerned is the period falling within paragraph 8(1)(a) above.

(3)For the purposes of this paragraph the relevant amount is the amount payable on redemption on the last relevant occasion, in a case where the redemption period concerned is one falling within paragraph 8(1)(b) above; and the last relevant occasion is the occasion for redemption, under a qualifying provision for redemption, last occurring before the redemption period begins.

(4)For the purposes of this paragraph—

(a)a relevant income period is any income period which consists of or falls within the redemption period,

(b)the relevant redemption day is the last day of the redemption period, and

(c)the relevant redemption provision is the qualifying provision for redemption providing for redemption on that day.