Annex 1: Minor changes in the law Change 42: UK REITs: conditions as to property rental business: exclusion of non-member’s interest: section 529 Example 1
Company A (the principal company of the group) has a property worth £40. Company B (wholly owned subsidiary of A) has a property worth £20. Company C (75% subsidiary of A) has a property worth £40. The remaining 25% interest in C is held by a non-member of the group.
If 100% of the value of C’s property is taken into account, the 40% test is passed (40 is not more than 40%x(40+20+40)). If only 75% of the value of C’s property is taken into account, the 40% test is failed (40 is more than40%x(40+20+30)).