IFM25005 | Real Estate Investment Trust : Capital gains: general : CTA2010/S535 and S535A

Exemption from tax for gains

Just as the profits of a UK REIT property rental business are not charged to corporation tax, gains relating to the property rental business are also not chargeable.

CTA2010/S535 exempts gains on disposals of assets that are used in the property rental business (IFM25006). CTA2010/S535A exempts an appropriate proportion of gains on disposals of rights or interests in UK property rich companies and “relevant funds” (IFM25007).

If any such disposal results in a loss, that loss will not be an allowable loss (TCGA1992/S2A(2)).

The amount of gain or loss on any disposal is calculated following the normal rules in TCGA. Other terms and expressions used in connection with the calculation also take their meaning and interpretation from TCGA given CTA2010/S535 and S535A are "to be read as if contained in TCGA1992" (CTA2010/S535(9) and S535A(9)).