Real Estate Investment Trusts

McKay Securities Plc converted to a Real Estate Investment Trust (REIT) on 1 April 2007, and as a result no longer pays UK corporation tax in respect of rental income and capital gains relating to its property rental business. REIT status does not alter the structure or activities of the Company.

Following conversion, the Company is required to distribute at least 90% of qualifying income profits each year as a Property Income Distribution (PID). The total distribution paid is likely to be a combination PID and non PID (ordinary dividend) elements. PID payments will generally be paid out after deduction of withholding tax at the current basic rate of 20% (non-PID (ordinary dividends) will be subject to taxation charges from 6 April 2016). Certain classes of shareholder may be able to claim exemption from this deduction and further information is contained in the Tax Consequences note below.