“(2YA)

Where an insurance company becomes an insurance special purpose vehicle otherwise than on the last day of a period of account, it shall be treated as an insurance special purpose vehicle from the beginning of that period.”.

“(7A)

In a case where—

(a)

the company becomes an insurance special purpose vehicle, and

(b)

regulations made under section 84 of the Finance Act 20054 do not apply to it,

subsection (7B) applies in the first period of account in which the company is an insurance special purpose vehicle (“the first period”).

(7B)

Where this subsection applies, in computing a company’s Case I profits there shall be brought into account as a trading receipt of the company the amount, if any, by which the amount shown in line 51 of Form 14 of the periodical return for the period preceding the first period exceeds—

(a)

the fund for future appropriations shown in the company’s IAD accounts, or

(b)

the unallocated divisible surplus shown in the company’s IAS accounts,

as the case may be, for that preceding period.

(7C)

In subsection (7B)—

“IAD accounts” means accounts drawn up in accordance with the Council Directive of 19th December 1991 on the annual accounts of insurance undertakings (No. 91/674/EEC)5;

“IAS accounts” means accounts prepared in accordance with international accounting standards.”.