This publication summarises the UK REITs regime and highlights the conditions that a company needs to satisfy in order to become a REIT and to remain within the regime.
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Real Estate Investment Trusts
We have a large team of dedicated Real Estate Investment Trusts (REIT) specialists, headed by Phil Nicklin who also leads the Treasury appointed technical group on REITs and the British Property Federation technical group, which has been responsible for shaping the REIT legislation. Phil is frequently quoted in the national and property press as the UK’s pre-eminent expert on the REIT regime.
The majority of UK REITs are Deloitte clients, including eleven out of the top fourteen.
What is a REIT?
A REIT is a UK resident listed company carrying on a “property rental business”. A REIT does not pay UK corporation tax on rental profits or capital gains arising from the property rental business. Tax is instead payable at the shareholder level. The REIT is therefore required to distribute 90% of its rental profits to its shareholders. However, where the REIT carries on activities other than “property rental business”, the profits and gains from these activities will be subject to UK corporation tax in the normal way.
Research and insight
How can we help?
Our cross service line teams (audit, corporate finance, tax and consulting) are experienced in providing a wide range of services to REITs and potential REITs, including:
- New entrants
- feasibility studies;
- conversion to REIT status;
- Compliance with REIT regime/general requirements
- audits of REITs;
- tax compliance;
- liaison with HMRC and the Treasury regarding general and client specific REIT issues;
- building models;
- Ongoing issues
- acquisition of a REIT by a REIT;
- major acquisitions from REITs;
- rights issues;
- joint ventures;
- disposal of corporates to REITs; and
- exit strategy.
