(1)In section 256(3) of the Taxes Act 1988 (order of income tax reductions etc.)—
(a)in paragraph (a), for “section 259 or 261A” there shall be substituted “ section 257AA ”;
(b)paragraph (b) shall cease to have effect;
(c)the words after paragraph (c) shall be omitted.
(2)Subsection (1)(a) and (b) above has effect for the year 2001-02 and subsequent years of assessment.
(3)Subsection (1)(c) above has effect for the year 2000-01 and subsequent years of assessment.
(4)For the year 2000-01, section 256(3) of the Taxes Act 1988 shall have effect with the omission of paragraph (a) and, in paragraph (b), of the words “except section 259 or 261A”.