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(i) a declaration of the kind specified in section 723(4) has not been made, or

(ii) any of the conditions referred to in section 723(3) is not satisfied at that time,

(a) the assurance company shall ensure that in accordance with section 723(2)(c) its special investment fund does not after that time represent its liability in respect of the policy, and

(b) as respects the individual, he or she has at that time a beneficial interest prohibited by section 839 in classes of investment mentioned in paragraphs (a) to (d) of subsection (1) of that section.

(b) for the purposes of the Tax Acts other than section 958(4), the liability to corporation tax of the company for the accounting period in which it became aware that the policy was not a special investment policy shall be increased by an amount determined by the formula—