10(1)In section 551 (tax consequences of distribution to holder of excessive rights), in subsection (1)(a), for “(as” substitute “that is not an excluded holder (both as”.
(2)In section 553 (meaning of “holder of excessive rights”)—
(a)in the heading, after “rights”” insert “and “excluded holder”,
(b)in subsection (1), omit the words after paragraph (b), and
(c)after subsection (4) insert—
“(4A)For the purposes of section 551, a holder of excessive rights is an “excluded holder” if—
(a)in accordance with double taxation arrangements (within the meaning of section 2(4) of TIOPA 2010), the holder is taxed at a particular rate, or not taxed at all, on distributions from a UK REIT, unless the sole reason for that treatment is the size of the holder’s interest in the UK REIT, or
(b)the holder is a person to whom a payment of a distribution must be made without deduction of income tax in accordance with regulation 7 of the Real Estate Investment Trusts (Assessment and Recovery of Tax) Regulations 2006 (S.I. 2006/2867) (gross payment of distributions).”