# The Finance Act 2002, Schedule 26, Parts 2 and 9 (Amendment No. 2) Order 2005, Article 6: Amendment of Part 2 of Schedule 26 to the Finance Act 2002


After paragraph 4A insert—
“4B. (1) This paragraph applies to a company if the conditions in sub-paragraph (2) are satisfied in relation to a relevant contract.
(2) The conditions are—
(a) the company is a party to the relevant contract both immediately before and on 28th July 2005,
(b) the relevant contract—
(i) was not a derivative contract immediately before that date, but
(ii) would (apart from this paragraph) be a derivative contract on that date, if an accounting period of the company began on that date, and
(c) the relevant contract was a chargeable asset immediately before that date.
(3) The company shall, when it ceases to be a party to the relevant contract, bring into account, for the accounting period in which it ceased to be a party to the contract, the amount of any chargeable gain or allowable loss which would have been treated as accruing to the company on the assumption—
(a) that it had made a disposal of the relevant contract immediately before 28th July 2005, and
(b) that the disposal had been for a consideration equal to the fair value of the relevant contract on that date.
(4) The relevant contract shall be treated for the purposes of this Schedule as a derivative contract entered into by the company on 28th July 2005 for a consideration equal to the fair value of the contract on that date.
(5) Sub-paragraph (4) of paragraph 4A (meaning of chargeable asset) also applies for the purposes of this paragraph.
4C. (1) This paragraph applies to a company if the conditions in sub-paragraph (2) are satisfied in relation to a relevant contract to which it becomes a party on or after 28th July 2005.
(2) The conditions are that (apart from this paragraph) the relevant contract—
(a) is not a derivative contract on the date on which the company becomes a party to it, but
(b) would be a derivative contract on that date, if an accounting period of the company began on that date, and
(c) is a chargeable asset when the company becomes a party to it.
(3) The relevant contract shall be treated for the purposes of this Schedule as a derivative contract on and after that date.
(4) Sub-paragraph (4) of paragraph 4A (meaning of chargeable asset) also applies for the purposes of this paragraph.”.

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Source: https://www.legislation.gov.uk/uksi/2005/2082/article/6 (the official version)
Page: https://openlegislation.uk/finance-act-2002-schedule-26-parts-2-and-9-amendment-no-2-order-2005/article-6
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.