Paragraph 5

(1)

Subject to sub-paragraph (2) and paragraph 7(3), the notional interest to be credited to the account under regulation G2(4)(e) is the interest that would have accrued for the financial year—

(a)

from the notional investment that was referred to in regulation 88(1)(c) of the 1976 Regulations (investment referable to accumulated balance of revenue over expenditure as at 31st March 1971), and

(b)

from the notional investments of annual balances that were referred to in regulation 88(1)(b) of the 1976 Regulations (balances for financial years ending on or after 31st March 1972), and

(c)

in any financial year beginning after 31st March 1989, from the assumed investments at the end of preceding financial years described in paragraph 6(4),

and half the interest that would have accrued for the financial year from the assumed investment described in paragraph 6(3).

(2)

There is to be deducted from the gross amount of the notional interest an amount equal to the income tax that would have been payable if the notional and assumed investments had been held for the purposes of a retirement benefits scheme approved under Chapter I of Part XIV of the Income and Corporation Taxes Act 1988^f1 which was an exempt approved scheme within the meaning of that Chapter and which provided benefits comparable to those provided under these Regulations.

Annotations

Footnotes

f1: 1988 c. 1.