There are no special rules changing the way in which section 179
TCGA applies to a UK-REIT. The broad effect of these provisions is
to bring back into charge a gain deferred on an earlier no gain/no
loss disposal if the asset in question leaves the group otherwise
than by a direct disposal of the asset (a de-grouping event). The
rules achieve this by a deemed disposal at market value. The
company leaving the group makes a deemed disposal and reacquisition
of the asset at market value immediately after the time it acquired
the asset from another group company. For detail on the operation
of these provisions, see CGM45400+.
There are no extra de-grouping events associated with
membership of a Group REIT since the deeming provision in section
136(1) FA 2006 (of G (tax-exempt) as a separate group) does not
apply to section 179 TCGA.
Once a de-grouping charge is triggered, its operation can be
affected by the fact that section 113(2) FA 2006 treats the part of
a company carrying on a tax exempt business as a separate company
for the purposes of CT. This may be relevant where, for example, a
previously tax- exempt company leaves a Group REIT. This is covered
in the examples at
GREIT05050.
The examples at
GREIT05037 illustrate how section 179
TCGA will operate in typical situations for a Group REIT.
