7(1)This paragraph applies where, at any time in the year 1994-95, the taxpayer makes any relevant appropriation or any section 574 disposal; and for the purposes of this paragraph there shall be determined—U.K.
(a)the amount of any reduction for that year which (disregarding relevant appropriations and section 574 disposals) would be made under paragraph 5(1) above, and
(b)the amounts of any indexation losses in respect of relevant appropriations or section 574 disposals made in that year.
(2)If the aggregate of the amounts referred to in sub-paragraph (1)(a) and (b) above does not exceed the limit for 1994-95, that is—
(a)£10,000, less
(b)the aggregate of the amount of any reduction made under paragraph 4(1) above for the year 1993-94 and of any increases made under paragraph 6(2) above for that year,
the amount of any allowable loss referable to such an appropriation or disposal shall be increased by any indexation loss in respect of it.
(3)In any other case, notwithstanding anything in paragraph 5 above, the aggregate of the amount of any reduction for the year 1994-95 to be made under paragraph 5(1) above and of the amount of any indexation losses in respect of relevant appropriations or section 574 disposals made in that year—
(a)shall be equal to the limit for 1994-95, and
(b)shall be allocated as the taxpayer may determine between that reduction and increases in allowable losses referable to such appropriations or disposals.