Channel Islands as Jurisdiction of Choice for REITs
While UK REITs must be tax resident in the UK, they can be incorporated in other jurisdictions. They would however have to be centrally managed and controlled in the UK for such companies to be solely tax resident in the UK. This is usually satisfied by having UK residents forming the majority of the board of directors and board meetings being held in the UK. REITs listed on TISE include companies incorporated in other jurisdictions, including Jersey and Guernsey.
TISE a Recognised Stock Exchange
In order to become a REIT, a company must meet all of the qualifying conditions in the UK Corporation Tax Act 2010 (CTA 2010) and give notice to Her Majesty’s Revenue and Customs (HMRC) that it wishes to join the REIT regime. One of the qualifying conditions of the CTA 2010 for REITs is that the company’s ordinary shares must be both (i) admitted to trading on a recognised stock exchange; and (ii) listed or traded on a recognised stock exchange.
TISE is a “recognised stock exchange” by HMRC pursuant to section 1005 of the UK Income Tax Act 2007.
TISE Free Float Exemption
TISE has exempted REITs from the 25% “free float” requirement (which requires that 25% of the shares of the company be held in the hands of the public). This is especially attractive to those REITs that will have a small number of investors, where there is less of a need for liquidity.
Appleby as Listing Member
Appleby Securities (Channel Islands) Limited acts as a sponsor for listing purposes, is a full listing member of TISE and can provide high quality, cost-effective professional services in all aspects of structuring and documenting REIT issuances.