Updating HMRC’s guidance on Real Estate Investment Trusts and the manuals more widely

The CIOT recently sent a letter to HMRC requesting an update to their guidance on Real Estate Investment Trusts (REIT) in their Investment Funds Manual (IFM21000 onwards).

We understand that HMRC’s settled view is that investment in, and income from, on-site renewable energy sources (for example, solar or air source heating on the building roof space that supplies power to tenants) is treated as part of the REIT’s qualifying property rental business for the purposes of Corporation Tax Act 2010 Part 12 and is, therefore, tax exempt. We also understand from members that HMRC has provided non-statutory clearances confirming this position. We suggested that the guidance be updated to reflect this.

There is a wider point here. We are very much in favour of the use of knowledge obtained through the clearance process to improve certainty and to reduce administrative burdens for all taxpayers through timely updates to guidance. As we said in our response to the consultation on advance tax certainty for major projects in 2025, the knowledge obtained through the clearance process should be used to improve certainty through sharing within HMRC, updating guidance and, where appropriate, seeking changes to legislation.

Continuing the theme of feedback to HMRC on their guidance, HMRC’s Agent Update 141 includes a reminder on how to provide feedback directly on HMRC’s manual pages. The feedback routes in the footer of all pages on GOV.UK can be used. It is also useful to know that the alternative contact GOV.UK form route allows users to request a reply from HMRC to the feedback given.

HMRC confirm that the HMRC Manuals Team review all items of feedback on HMRC manuals from internal and external users.

Kate Willis [email protected]