Section 529 — Corporation Tax Act 2010: Conditions as to property rental business

Conditions as to property rental business 529 1 Condition A is that the property rental business involves at least 3 properties.

2 Condition B is that no single property represents more than 40% of the total value of the properties involved in the property rental business. 2A Condition C is , or was at any time from the relevant time, that the property rental business involves at least 1 property—

a the value of which is equal to, or in excess of , £20 million ..., and b which is designed, fitted or equipped for the purpose of being rented, and is rented or available for rent, as a commercial unit. 2B For the purposes of subsection (2A) the “ relevant time ” means the later of —

a entry, and b when the property was acquired.

3 For the purposes of conditions A to C the property rental businesses of the members of a group are to be treated as a single business.

4 For the purposes of conditions A to C —

a a reference to a property “involved” in a business is a reference to an estate, interest, or right by the exploitation of which the business is conducted, b a property is a single property if it is designed, fitted or equipped for the purpose of being rented, and it is rented or available for rent, as a commercial or residential unit (separate from any other commercial or residential unit),

c assets must be valued in accordance with international accounting standards, d where international accounting standards offer a choice of valuation between cost basis and fair value, fair value must be used, and e no account is to be taken of liabilities secured against or otherwise relating to assets (whether generally or specifically).

5 If a percentage of the profits of property rental business of a member of a group UK REIT is excluded from a financial statement in accordance with section 533(3), that percentage of the member's property rental business is to be ignored for the purposes of subsection (2).