(1) For the purposes of relief under this section, an individual's relevant earnings shall be those earnings before giving effect to any deduction to be made from those earnings in respect of a loss or in respect of a capital allowance (within the meaning of section 2), and references to income in this section (other than references to total income) shall be construed similarly.
(2) For the purposes of this section, "net relevant earnings", in relation to an individual and subject to subsections (3) to (5), means the amount of the individual's relevant earnings for the year of assessment in question less the amount of any deductions to be made from the relevant earnings in computing the individual's total income for that year, being either -
(a) deductions in respect of payments made by the individual, or
(b) deductions in respect of losses or of such allowances mentioned in subsection (1), being losses or allowances arising from activities, profits or gains of which would be included
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