—(1) In determining the income of a person to be exempted from tax under section 13(1)(b) of the Act (referred to in this regulation as the exempt income) —
the Comptroller shall have regard to such expenses, capital allowances and donations allowable under the Act as are, in his opinion, to be deducted from the exempt income;
there shall be deducted from the exempt income any allowances under section 19, 19A, 20, 21 or 22 of the Act attributable to that income notwithstanding that no claim for those allowances has been made;
any balance of the allowances mentioned in sub-paragraph (b) and any losses incurred in respect of any qualifying project debt securities from which the exempt income is derived shall only be deducted against exempt income derived from such qualifying project debt securities for the same and subsequent years of assessment, and any balance of such allowances and losses shall not be deducted against any other income; and
any balance of the allowances and losses mentioned in sub-paragraph (c) remaining unabsorbed as at the end of the period for which the exemption from tax under section 13(1)(b) of the Act applies shall, subject to paragraph (2), be available as a deduction against any other income for the year of assessment which relates to the basis period in which the tax exemption ceases, and any subsequent year of assessment in accordance with section 23 or 37 of the Act, as the case may be.
(2) Section 37B of the Act shall apply to any amount of allowances and losses available as a deduction against any other income as provided under paragraph (1)(d) as if they were unabsorbed allowances or losses in respect of the income of a company subject to tax at a lower rate of tax under that section; and for this purpose the rate of tax shall be taken to be the concessionary rate of tax in accordance with the regulations made under section 43N of the Act.