Part 12Real Estate Investment Trusts
Chapter 3Tax treatment of profits and gains of UK REITs
535Gains
1
A gain on the disposal of an asset is not a chargeable gain if—
a
the gain accrues to a company which is, or is a member of, a UK REIT, and
b
condition A or B is met in relation to the asset.
2
Condition A is that the asset was used wholly and exclusively for the purposes of property rental business of the company.
3
Condition B is that the asset was used during one or more periods of (in total) less than a year—
a
partly for the purposes of property rental business of the company, and
b
partly for the purposes of residual business of the company,
but was otherwise used as mentioned in subsection (2).
4
Subsection (5) applies if a gain accrues to a company which is, or is a member of, a UK REIT on the disposal of an asset which for one or more periods of (in total) at least a year has been used—
a
partly for the purposes of property rental business of the company, and
b
partly for the purposes of residual business of the company.
5
Such part of the gain as may reasonably be attributed to property rental business of the company, having regard to—
a
the extent to which the asset was used for the different purposes, and
b
the length of the periods during which it was used for those purposes,
is not a chargeable gain.
6
Gains which—
a
accrue to residual business of a company which is, or is a member of, a UK REIT, and
b
are charged to corporation tax,
are to be so charged at a rate determined without reference to sections 18 to 23 (small profits rate and marginal relief).
7
If a percentage of the gains of property rental business of a member of a group UK REIT is excluded from a financial statement in accordance with section 533(3), that percentage of those gains is to be treated for corporation tax purposes as gains of the member's residual business.
8
This section has effect in relation to a non-UK member of a group UK REIT as if references to property rental business of the member were to its UK property rental business.
9
This section is to be read as if it were contained in TCGA 1992.