Real Estate Elections (REE)

Produced by Tolley
Real Estate Elections (REE)

The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Real Estate Elections (REE)
  • What is an REE?
  • When is an option to tax effective under an REE?
  • What purchases are excluded from an REE?
  • Options to tax made before an REE
  • Automatic revocation where no interest held
  • Converting a single option into separate options to tax
  • Notifying HMRC of an REE
  • Providing up to date REE lists to HMRC
  • Global options to tax
  • More...

This guidance note will be of relevance to any business, or their advisers, who intend to acquire a large number of properties and want to opt to tax all of them, or a business that has made a 'global' option to tax in the past.

Note that HMRC has made some temporary changes to notifying an option to tax during the COVID-19 (coronavirus) outbreak (notably extending the deadline for notification from 30 to 90 days). These changes aren’t covered in this guidance note; but for details, see the Coronavirus (COVID-19) and VAT - further VAT consequences guidance note.

What is an REE?

This is a formal decision made by a business that it is going to opt to tax all property transactions going forward.

If a business makes the REE, it will be treated as if it made an option to tax in relation to every property that it subsequently acquires an interest in. Each property that is acquired will be treated as if it has been separately optedto tax and the option to tax will be effective from the date of acquisition.

The business can revoke individual options to tax if it meets the necessary requirements. Please see the Revoking an option to tax guidance note for more information.

Once the business has made the REE to HMRC it is not required to notify HMRC when it acquires new land and property.

Please note that if a business wants to opt to tax a property that it currently does not have an interest in, it will be necessary for the business to make a separate notification of the option to tax under the normal rules, as the REE cannot be used in these circumstances.

Please see the Overview of the option to tax guidance note for more information.

When is an option to tax effective under an REE?

Once the REE is in place, any land and property acquired by the business will be treated as optedto tax with effect

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