(1) Section 410 of the Principal Act is amended -

(a) in subsection (4) by substituting "a relevant Member State" for "the State", and

(b) by substituting the following for subsection (5):

"(5) This section shall apply to any payments which -

(a) for the purposes of corporation tax, are charges on income of the company making them or would be so if they were not deductible in computing profits or any description of profits or if section 243(7) did not apply to them, and

(b) where the company receiving the payments is not resident in the State, are taken into account in computing income of that company chargeable to tax in a relevant Member State,

but shall not apply to payments received by a company on any investments if a profit on the sale of those investments would be treated as a trading receipt of that company.".

(2) This section applies as respects accounting periods ending on or after 1 March 2005.