OECD Releases Real Estate Investment Trusts Model For Comment

On 30 October 2007 the OECD released a draft discussion paper to introduce a framework for a consistent taxation treatment of REITs.

The OECD defines a REIT in the model tax treaty as "a widely held company, trust or contractual or fiduciary arrangements which derive their income primarily from long term investments in immovable property (real estate), distribute most of that income annually, and do not pay tax on income related to immovable property that is so distributed."

The following table highlights the main issues in the OECD draft model tax treaty framework and compares this to the current taxation of Australian REITs ("A-REITs").