2A

But amounts are not allowed as such a deduction if they—

a

are allocated to holders of policies under which they are eligible to participate in surplus,

b

are of a capital nature, and

c

are not funded from amounts brought into account as part of total income in line 19 of the revenue account prepared for the purposes of Chapter 9 of the Prudential Sourcebook (Insurers) in respect of the whole of the company's long-term business.

2B

For the purposes of subsection (2A) above payments made in connection with the reattribution of inherited estate are to be regarded as being of a capital nature.