There are a number of provisions included within the draft
Finance Bill 2012 tailored to the property sector.
Notably, REITs were singled out for overhaul, notice given of
possible changes to property alternative investment funds (PAIFs),
and refinements made to the capital allowance claims process on
second -hand fixtures.
It is perhaps heartening to see that thought is being given to
encouraging investment into property with a driver being tax
efficiency.
The changes in brief
REITs
- The abolition of the 2% conversion charge.
- Allowing REITs to list on AIM and Plus Markets and their
overseas equivalents. (Private REITs are not permitted).
- Introduction of a grace period to meet the non-close company
requirement (a tax technical term), the strategy being that a close
company will be permitted to convert to REIT status, provided it
attracts sufficient investors over the first three years so that it
becomes nonclose within that three-year period.
