Real Estate Investment Trusts (REITs)
Who needs it?
Property investment companies listed on a recognised stock exchange converting to REIT status from January 2007.
What is it?
The tax-exempt part of companies wishing to convert to REIT status does not pay tax. However, there are a number of factors relating to capital allowances which must be considered both on entry into the regime and on an ongoing basis. Capital allowances will need to be determined on entry into the regime as it will ultimately affect the conversion charge payable. On an ongoing basis, a shadow regime will need to be operated by companies that have converted as this will affect the property income dividend (PID) payable to investors. It is worth noting that investors themselves cannot directly use capital allowances to offset against any withholding tax.
Capitus is fully conversant with the operation of the REIT regime and how it interacts with capital allowances and can supply information relating to entry into the regime and can also identify capital allowances for companies already in the regime.
Please call 0121 447 8388 or e-mail enquiries@capitus.co.uk for queries on any of our services. We will personally get back to you. Our initial advice is free!
