As respects the year of assessment 2000-2001 and subsequent years of assessment, the Principal Act is amended -

(a) by the substitution of the following for section 465:

"465. Incapacitated children.

(1) In this section -

'appropriate percentage', in relation to a year of assessment, means a percentage equal to the standard rate of tax for that year;

'qualifying child', in relation to an individual, means a child of the individual who -

(a) is under the age of 18 years and is permanently incapacitated by reason of mental or physical infirmity, or

(b) if over the age of 18 years at the commencement of the year of assessment, is permanently incapacitated by reason of mental or physical infirmity from maintaining himself or herself and had become so permanently incapacitated before he or she had attained the age of 21 years or had become so permanently incapacitated after attaining the age of 21 years but while he or she had been in receipt of full-time instruction at any university, college, school or other educational establishment;

'specified amount', in relation to a qualifying child for a year of assessment, means £1,600.

(2) Where an individual proves that he or she has living at any time during a year of assessment a qualifying child, the income tax to be charged on the individual, other than in accordance with section 16(2), for that year of assessment shall, in respect of each such child, be reduced by an amount which is the lesser of -