GREIT06020 - Leaving the regime: termination by company

If a company wants to leave the UK-REIT regime, it does so by giving notice to HMRC (section 128 FA 2006). In practice, this notice should be sent to the tax office that deals with the company.

There is no prescribed form for the notice: the only requirements are that it should be given in writing [or electronic equivalent] and it must specify the date on which the company wishes the regime to cease to apply to it.

The date specified in the notice for cessation of the regime must be after the date of the notice. Note that under the cessation provisions in section 131 FA 2006, the accounting periods of C (tax-exempt) and C (residual) will come to an end (see GREIT06010).

Exit within ten years of joining

If the company specifies a date to leave the regime that is less than ten years after it joined, the tax treatment of disposals of ring-fence assets in the two years following cessation may be affected – see GREIT06035.

Group REITs

Analogous rules apply where the principal company of a Group REIT gives notice that it wants the group to leave the regime within 10 years of joining. The same rules also apply where a company ceases to be a member of Group REIT within 10 years of becoming a member of a Group Real Estate Investment Trust. For more detail, see GREIT11320.