IFM22365 | Real Estate Investment Trust : Group conditions and rules: Financial Statements: UK property rental business: entities that are not wholly owned

Joint venture companies/groups

A group may be involved in a joint venture carried on via a company/group. If there is a Joint Venture Look-Through notice in place (see IFM30005), then the group (referred to as the venturing group) includes the profits etc of the joint venture company/group in the financial statements for UK property rental business in the same way as it does for the same items for companies that are members of the venturing group (CTA2010/S588).

Where a company is involved in a joint venture carried on via a company/group and there is a Joint Venture Look-Through notice in place (see IFM30005), then the company (referred to as the venturing company) and the joint venture company/group are treated as members of a new group REIT. Financial statements are required for this deemed UK REIT (CTA2010/S588(2).

The joint venture group produces three sets of financial statements, including details in respect of the interest held by the venturing company and these feed into the venturing company/group financial statements.

Other entities in which the group has an interest

If the entity is transparent for tax purposes (e.g. a UK partnership), the group’s share of the profits etc to the extent they derive from qualifying property rental business, are included in the financial statements for UK property rental business.

If the vehicle is not transparent (e.g. a company that is less than 75% owned or an OEIC) then there will be no entries in connection with it in the financial statements for UK property rental business.

The value of the interest in the entity and in any income arising from that interest will be part of the residual business.