IFM22005 - Real Estate Investment Trust : Conditions and Tests: Summary

Before giving notice to join the regime, the company or principal company of a group, which has an established property rental business (defined at CTA2010/S519), must meet two conditions (A and B) and once in the regime, must meet four further conditions throughout every accounting period that it is in the regime, (although condition C does not have to be met for all of the first day of the first accounting period and Condition D does not have to be met during an accounting period ending, or the part of an accounting period falling, during the period of three years beginning with the date the notice is given)). The conditions are set out in CTA2010/S528.

The conditions for joining the regime are:

A - that the company is UK resident.

B - it must not be an open-ended investment company

C - its shares must be admitted to trading on a recognised stock exchange.

D - it must not be ‘close’ company.

E - the only shares it can have in issue are a single class of ordinary share capital and various classes of relevant preference shares, and

F - it must not be party to any loan where the results are dependent on the profits of the business.

For more detail on conditions A-C see IFM22010, and for conditions D-F see IFM22015. For more detail on conditions C and D on entering the regime see IFM23010.