REITS

Question 1

What is the alternative name for the ring-fenced element of a REIT?

Answer 1

The tax-exempt element

Question 2

What is the alternative name for the tax exempt element of a REIT?

Answer 2

The ring-fenced element

Question 3

What assets are included in the tax-exempt element of a REIT?

Answer 3

Properties

Question 4

What is the corporation tax status of the tax-exempt element of a REIT?

Answer 4

No corporation tax

Question 5

What type of income do you receive from the tax-exempt element of a REIT and what is the tax status of it?

Answer 5

Property income taxed at income tax marginal rates

Question 6

What is one of the limitations of ring-fenced income from the tax-exempt element of a REIT?

Answer 6

There is no Personal Savings Allowance

Question 7

How is income paid from the tax-exempt element of a REIT?

Answer 7

Net of basic rate tax

Question 8

What is the CGT position of a REIT?

Answer 8

Same as collectives

Question 9

What assets are included in the tax exempt element of a REIT?

Answer 9

Properties

Question 10

What is the corporation tax status of the taxable element of REITS?

Answer 10

Liable to corporation tax

Question 11

What kind of income do you receive from the taxable element of a REIT?

Answer 11

Dividend payments

Question 12

What is the dividend allowance for the taxable element of a REIT?

Answer 12

£2,000

Question 13

How is income paid from the taxable element of a REIT? (net/gross)

Answer 13

Gross

Question 14

What are the 4 rules for a company to qualify as a REIT?

Answer 14

1. At least 75% of the company’s gross profit must be from the property element
2. At least 75% of the company’s assets must be in the property element
3. Interest on borrowings must be at least 125% covered by rental profits
4. Must distribute 90% of profits from property element within 12 months