Jersey Property Unit Trusts And The Proposed UK REIT Compared

Jersey Property Unit Trusts ("JPUTs") have been used extensively as a vehicle to acquire and hold UK property. The key driver for this has been the seeding relief exemption from Stamp Duty Land Tax ("SDLT"), but there are other key attractions of a JPUT. This article summarises the key benefits of a JPUT, compares a JPUT to the proposed UK REIT and outlines the regulatory framework in Jersey for the establishment of a JPUT.

A JPUT which is structured as a "Baker Trust" is recognised as being transparent for income tax so that for UK tax purposes income is treated as directly attributable to the unitholders and unitholders are able to set off expenses of the JPUT against that income.