Finance Act 1975

2 (1) In any case where paragraph 1(1) applies, a company's 1973 increase in stock value shall be determined for the purposes of the principal section by the formula:—

where—

• " A " is the number of months in the company's 1973 accounting period or 12, whichever is the less ;

• " C " is the value of the company's trading stock at the end of the 1973 reference period ;

• " O " is the value of the company's trading stock at the beginning of the 1973 reference period ; and

• " N " is the number of months in the 1973 reference period.

(2) In any case where a company's 1973 increase in stock value falls to be determined in accordance with sub-paragraph (1) above, any reference in subsections (3) to (5) of the principal section or in the following provisions of this Schedule—

(a) to the company's closing stock value shall be construed as a reference to the value of the company's trading stock at the end of the 1973 reference period; and

(b) to the company's trading income for its 1973 accounting period shall be construed as a reference to that fraction of its trading income for the 1973 reference period of which the numerator is A and the denominator is N, as defined in sub-paragraph (1) above.

(3) For the purposes of sub-paragraph (2)(b) above, the company's trading income for the 1973 reference period shall be the aggregate of its trading income for each of the accounting periods comprised in the 1973 reference period.