(1) Section 485 of the Act of 1997 is amended -

(a) in subsection (1) -

(i) by the substitution of the following definition for the definition of "relevant business activity":

"'relevant business activity', subject to subsection (1A), has the meaning assigned to it in subsection (4);",

and

(ii) by the insertion of the following definitions:

"'approved body of persons' has the same meaning as in section 235;

'charity' has the same meaning as in section 208;",

(b) by the insertion of the following subsection after subsection (1):

"(1A)

(a) Where a charity carries on a trade, the profits or gains arising from which would be chargeable to tax under Case I of Schedule D but for section 208(2)(b), that trade shall be regarded as a relevant business activity for the purposes of this section.

(b) Where an approved body of persons carries on a trade, the profits or gains arising from which would be chargeable to tax under Case I of Schedule D but for section 235(2), that trade shall be regarded as a relevant business activity for the purposes of this section.",