A group of companies may become a group to which the REIT legislation applies (known as a group UK REIT).The treatment of groups of companies to which the REIT regime applies (hereafter referred to as group UK REITs) is broadly the same as single company UK REITs, but there are some differences as detailed at D7.1153.
Definition of a group for REIT regime
A group for the purposes of applying the REIT provisions is defined1 as for chargeable gains purposes in TCGA 1992, s 170 (see D2.305).
In other words it is a principal company and all its 75% direct and indirect subsidiaries (CTA 2010, s 1154(3), see D2.106), provided they are effective 51% subsidiaries as defined in TCGA 1992, s 170(1). For REIT group purposes however, the principal company is required to be UK resident2 (D7.1104) although there is no residence requirement for other members of the group. As for chargeable gains purposes, a company cannot be a member of more than one group, defined as in TCGA 1992, s 170(6)3 except in certain limited circumstances where the relevant company is the parent of a joint venture group.
However, certain companies that could be in a chargeable gains group are excluded from being part of a group UK REIT4. These include insurance companies and their subsidiaries and open-ended investment companies.
Furthermore, certain companies that would not be included in a chargeable gains group may be included in