(1)This section—
(a)applies for the purpose of calculating profits or other income charged to income tax, but
(b)does not apply for the purpose of calculating the profits of a trade, profession or vocation or of a property business (but see subsection (4)).
(2)No deduction is allowed for expenses incurred—
(a)in making a payment if the making of the payment constitutes a criminal offence, or
(b)in making a payment outside the United Kingdom if the making of a corresponding payment in any part of the United Kingdom would constitute a criminal offence in that part.
(3)No deduction is allowed for expenses incurred in making a payment induced by a demand which constitutes—
(a)the offence of blackmail under section 21 of the Theft Act 1968 (c. 60) (England and Wales),
(b)the offence of extortion (Scotland), or
(c)the offence of blackmail under section 20 of the Theft Act (Northern Ireland) 1969 (c. 16 (N.I.)) (Northern Ireland).
(4)Provision corresponding to that made by this section is made by—
(a)section 55 (in relation to trades, professions and vocations), and
(b)section 272 (in relation to property businesses).