Latest Reits rules pose interpretation challenge

Chris Luck, partner, says the key change in the statutory instruments put into the public domain late yesterday modify the definition of companies holding shares and dividend rights in Reits, as compared with individuals and non-corporate shareholders. This is of particular importance with regard to the so-called 10% holding rule, under which shareholders owning more than 10% both of a Reit’s voting rights and dividend distribution rights would be hit with a tax penalty. The bottom line for investment trusts is the latest regulations suggest they could be hit by additional tax charges...