This section applies where an arrangement is entered into wholly or mainly for a disqualifying purpose.

Arrangements are entered into for a disqualifying purpose if their main purpose, or one of their main purposes, is to enable a person to obtain an annual investment allowance to which the person would not otherwise be entitled.

The annual investment allowance mentioned in subsection (2) is not to be made.

Any annual investment allowance which is prohibited by subsection (3), but which has already been made, is to be withdrawn.