IFM29005 | Real Estate Investment Trust : Miscellaneous: funds awaiting reinvestment : CTA2010/S547

Income arising on funds awaiting reinvestment

Where a UK-REIT disposes of an asset , either directly or indirectly, used in the property rental business and retains the proceeds in cash, any interest or other income arising from a loan relationship entered into in connection with the cash is ignored for the purposes of the calculation of profits under CTA2010/S599. Such income is not exempt property rental business income, it is income of the residual business. (CTA2010/S547).

However cash awaiting reinvestment is included in the Balance of business condition B (asset test) (CTA2010/S531(5)-(9)) (see IFM22075)