GREIT12035 – Group conditions and rules: Maximum shareholding rule

For Group REITs, the maximum shareholding rule in section 115 FA 2006 operates in respect of shares in the principal company of the group. For more detal on how this operates, see GREIT02100 onwards. If any charge in respect of a company holding an interest of 10% or more in the principal company arises, it falls on the principal company. It is collected by way of a Schedule D Case V on the residual part of that company.

There are no restrictions on ownerhsip of shares in subsidiary members of of the group. No tax charge under regulation 10 SI 2006/2864 arises if a dividend is paid in respect of a company which has an interest of 10% or more in the subsidiary.