This paragraph applies if the adjusted number of penalty points for the new group of returns is greater than zero, but less than the actual number of penalty points for the old group of returns.

Treat the person as having, for the new group of returns, the penalty points which were awarded in respect of the x most recent relevant failures (but if a single penalty point was awarded in respect of more than one relevant failure, for the purposes of this sub-paragraph treat those relevant failures as a single relevant failure).

“X” is the adjusted number of penalty points for the new group of returns.

Treat the penalty points in respect of the other relevant failures as having expired (so that the person has no penalty points for the old group of returns).

In this paragraph “relevant failure” means a failure to make a return in the old group of returns on or before its due date, in respect of which a penalty point was awarded.