Corporation Tax Act 2010 section 550

Attribution of distributions

Section 550 sets out the order in which distributions made by a UK REIT must be attributed to different sources of income and gains.

• Distributions by a UK REIT (whether a standalone company or the principal company of a group REIT) must be attributed in a strict six-step order of priority
• The first two priorities satisfy the mandatory distribution requirements for property rental profits and residual income under section 530
• Remaining distributions are then attributed in order to taxable activities, property rental profits, non-chargeable capital gains from property rental business, and finally any other distributions
• When calculating non-chargeable gains for attribution purposes, the corporate loss restriction rules are ignored