Tax transparent structures place each investor, broadly, in the same taxation position as if they had acquired property directly. This can be achieved by a partnership, where the partners are taxed on their share of underlying income and gains as they arise. Real Estate Investment Trusts and Property Authorised Investment Funds can also provide features of tax transparency for investors in UK property. A consultation is under way to reduce barriers to entry and regulatory burdens for REITs. To date, the take-up of PAIF status has been very disappointing due to a number of practical difficulties with the requirements to enter this regime.
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