BECOMING A UK-REIT 23
7. IMPLICATIONS OF BREACHING THE UK-REIT REGIME CONDITIONS
There are a number of conditions that need to be met to remain within the UK-REIT regime (see Appendix B). The extent to which the conditions may be breached without the UK-REIT being expelled from the regime will depend on a number of factors including which condition is breached, how seriously it is breached and how many times that condition has been breached since entry into the regime (or ten years if shorter).
AUTOMATIC TERMINATION FOR BREACH OF CONDITIONS If one or more of the UK-REIT company conditions relating to tax residence, open‑ended investment company status, the classes of issued share or the nature of the loans issued by the UK-REIT are not satisfied in respect of a particular accounting period, the UK-REIT will be automatically excluded from the regime from the end of the accounting period before that in which the breach took place. The rules concerning breaching the admitted to trading rules and close company test are not as onerous (i.e. certain breaches are allowed). Further details of these are set out in Appendix C.
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