Suntec REIT has received a ruling from the Australian tax authorities, which will result in the REIT continuing to enjoy a concessionary withholding tax rate, providing a ~4% 1H25 DPU uplift. This comes on top of sharp year-to-date declines in domestic interest rates, which has resulted in 6% lower finance costs in 1H25.
- Read this at SGinvestors.io -
Retaining the managed investment trust (MIT) structure in Australia for FY25
Suntec REIT (SGX:T82U) is retaining the managed investment trust (MIT) structure in Australia for FY25, which will result in its Australian income (~18% of 1H) taxed at 10% or 15% on distributions vs the effective Australian tax rate of 30-45%.
- Read this at SGinvestors.io -
The Australian Taxation Office has ruled that the inability to meet the requirements was only temporary and beyond the control of the REIT, and that it was fair and reasonable to treat the trust as a MIT. As a result, Suntec REIT will be reversing the ~S$4m tax provision made in 1H25 and will continue to enjoy lower tax rates moving forward.
Additionally, Suntec REIT also joined the UK REIT regime in April, which will lower its UK tax rates by 10ppts and result in an estimated GBP1-1.5m tax savings per annum.
Financing costs fell to 3.82%.
Read more at SGinvestors.io.
Above is an excerpt from a report by RHB Securities Research. Clients of RHB may be the first to access the full PDF report @ https://www.rhbtradesmart.com/.
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