ANNEX 1:: MINOR CHANGES IN THE LAW MADE BY THE BILL Contributions to a firm — trading profits not drawn
The Act also provides that an individual’s share of trading profits, taken into account in determining the individual’s contribution to the firm, is calculated by looking at periods where such profits were made, and ignoring trading losses in other periods. The source legislation does not contain an equivalent provision. The effect is broadly to determine an individual’s share of undrawn trading profits as the amount that the individual would have received if such profits had been distributed fully on a period by period basis. See sections 105(8) and 111(8).