134(1)In relation to any case which involves any previous tax years before 1995-96, subsection (3) of section 635 applies in accordance with sub-paragraphs (2) and (3) below.U.K.
(2)So far as that subsection applies in relation to those previous tax years, for paragraph (c) substitute—
“(c)so much of any income arising under the settlement in any previous year which has not been distributed as is shown to consist of income which has been treated as income of the settlor by virtue of section 671, 672, 674, 674A or 683 of ICTA,
(d)any income arising under the settlement in any previous year which has been treated as the income of the settlor by virtue of section 673 of ICTA,
(e)any sums paid by virtue or in consequence of the settlement, to the extent that they are not allowable, by virtue of section 676 of ICTA, as deductions in computing the settlor's income for any previous year,
(f)any sums paid by virtue or in consequence of the settlement in any previous year which have been treated as the income of the settlor by virtue of section 664(2)(b) of ICTA,
(g)any sums included in the income arising under the settlement as amounts which have been or could have been apportioned to a beneficiary as mentioned in section 681(1)(b) of ICTA, and”.
(3)For paragraph (d) of that subsection substitute—
“(h)an amount equal to the sum of tax at the rate applicable to trusts on—
(i)the total amount of income arising under the settlement in that year and any previous year which has not been distributed, less
(ii)the total amount of the income and sums referred to in paragraph (c) (in relation to tax years 1995-96 onwards) and paragraphs (c), (d), (e), (f) and (g) as substituted by paragraph 134 of Schedule 2 (in relation to tax years before 1995-96).”
(4)In relation to any sum paid before 6th April 1995, subsection (3) of section 634 applies with the substitution of “ in one of the events specified in section 673(3) of ICTA ” for paragraphs (a) and (b).
(5)Subsection (5)(a) of section 634 does not apply if the direction or assignment was given or made before 6th April 1981.