Corporation Tax Act 2010 section 530A

Condition as to distribution of profits: increase in profits after delivery of tax return

Section 530A provides additional time for a UK REIT to meet its profit distribution requirement when the profits of the property rental business turn out to be higher than originally reported in the tax return.

• Where UK property rental profits are increased after the tax return has been filed, distributions made within three months of the date the return can no longer be amended are treated as meeting the normal distribution deadline.
• The relief is capped: only up to 90% of the increase in profits can be treated as having been distributed within the original deadline.
• The rule applies both to group UK REITs (where the principal company files a financial statement of group UK profits) and to single-company UK REITs (where the company reports its own property rental profits).
• This provision cannot be used to satisfy the basic requirement that at least 90% of the originally reported profits must be distributed on time — it only helps with the additional profits discovered later.