Finance Act 1996

6 (1) This paragraph applies where a person who has received a payment to which any of the following sections applies, namely—

(a) section 534 of the principal Act (relief for copyright payments etc.);

(b) section 537A of that Act (relief for payments in respect of designs); and

(c) section 538 of that Act (relief for painters, sculptors and other artists),

makes a claim under subsection (1) of that section requiring that effect be given to the following provisions of that section in connection with that payment.

(2) The claim shall relate to the year of assessment in which the payment in question is receivable (“the payment year”); and for the purposes of this sub-paragraph a payment shall be regarded as receivable in the year of assessment in computing the amount of the profits or gains of which it would, but for the relevant section, be included.

(3) Subject to sub-paragraph (4) below, in so far as the claim relates to the profits or gains of a year of assessment earlier than the payment year (“the earlier year”), the claim shall be for an amount equal to the difference between—

(a) the amount in which the person is chargeable to tax for the earlier year (“amount A”); and

(b) the amount in which he would be so chargeable on the assumption that effect could be, and were, given to the claim or amendment in relation to that year (“amount B”).

(4) Where effect has been given to one or more associated claims, amounts A and B above shall each be determined on the assumption that effect could have been, and had been, given to the associated claim or claims in relation to the earlier year.

(5) In so far as the claim relates to the profits or gains of the earlier year, effect shall be given to the claim in relation to the payment year by an increase in the amount of tax payable.