REPUBLIC ACT 9856 - REAL ESTATE INVESTMENT TRUST (TAX INCENTIVES)

REPUBLIC ACT 9856 - REAL ESTATE INVESTMENT TRUST (TAX INCENTIVES)

In A Nutshell:

The taxable net income of REAL ESTATE INVESTMENT TRUSTs is the gross income under Section 32 less

(a) the deductions under Section 34 AND

(b) dividends distributed by the REIT out of its distributable income provided it

(i) maintains its status as a public company;

(ii) maintains the listed status of the investor securities (shares issued by the REIT); and

(iii) distributes at least 90% of its distributable income.

Other Tax Rules:

>Not subject to the MCIT
>Income payments to REIT are subject to a lower CWT of 1%
>Sale of real property to REITs subject to DST reduction of 50%
>Dividends received by an OFW from the REIT is exempt from the 10% WT for the first 7 years of the law.
>VAT is imposed on sale of real property by the REIT but not of its securities as it is not considered a dealer in securities

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