LAWFUEL – UK Law Newswire – On the 1 April 2007, Shaftesbury PLC became a REIT. Shaftesbury PLC is a property company which has been a client of the firm since 1987 when David Harris and Jane Rigler acted on its flotation. The company has extensive property holdings in London areas Chinatown, Covent Garden, Carnaby and Charlotte Street, predominately used as shops, restaurants, bars and studio space.
Detail: Conversion to a REIT requires accounting, tax and corporate advice. Shaftesbury’s accountants and tax advisor is PWC. Nigel Read provided the corporate advice assisted on property aspects by Jane Rigler and Gill McGreevy.
This is a momentous change for the company. Becoming a REIT means, in broad brush terms, that the company ceases to pay Corporation Tax or Capital Gains Tax. Shareholders will continue to pay tax on their dividends, but the element of double taxation is removed. The concept of REIT was introduced by UK legislation permitting the establishment of REITS in the UK from 1 January 2007. Shaftesbury joins a small but illustrious band of property companies who have either already converted or who are proposing to convert in the near future.
Comment: The significance for the firm is that this creates an important track record for acting on a conversion.