(1) In relation to a vehicle to which this Part applies, section 284 shall apply as if, for the purposes of that section, the actual cost of the vehicle were taken to be the specified amount where the expenditure incurred on the provision of the vehicle exceeded that amount and, where an allowance which apart from this subsection would be made under section 284 is to be reduced by virtue of this subsection, any reference in the Tax Acts to an allowance made under section 284 shall be construed as a reference to that allowance as reduced under this subsection.

(2) In relation to a vehicle to which this Part applies, the allowances under section 284 to be taken into account for the purposes of Chapter 2 of Part 9 in computing the amount of expenditure still unallowed at any time shall be limited to those computed in accordance with subsection (1), and the expenditure incurred on the provision of the vehicle to be taken into account for the purposes of that Chapter shall be limited to the specified amount.