REITs

The initials REIT stand for Real Estate Investment Trust. Property companies can convert to REIT status and in return, they receive tax concessions from the Government.

REITs originated in the US but were introduced in the UK in 2007, when nine property companies converted, including well-known names such as BritishLand, Land Securities and Hammerson.

UK REITs must be based in this country and they have to pay dividends net of the basic rate of tax. They must also be listed on the Main Market as opposed to AIM.

For investors, REITs behave in the same way as ordinary shares. They can be bought and sold through the London Stock Exchange and investors in REITs have to pay the same taxes on them as on any other shares