The level of taxation depends upon the status of an institution. Many significant investors, such as pension funds, are tax-exempt. They therefore have a competitive edge over other investors in the market with a less advantageous tax status, who can thus be more readily outbid. 

The main taxes affecting investors are capital gains tax, corporation tax, income tax, and inheritance tax. A further tax affecting real estate is VAT. This is now extended to apply to some (elected) transactions in land, which include the optional taxation of rents, transfers and payments for the surrender of leases. The Uniform Business Rate ("UBR") is a tax specific to non-domestic real estate, and replaces non-domestic rates. UBR is based on the hypothetical letting value of commercial real estate, and is levied upon the occupier, rather than the owner. If vacant, an unoccupied rate is levied on the landlord; listed properties are exempt. However, while the impact falls on the occupier, this in turn affects his ability to pay rent, hence the final responsibility for the tax remains with the property's owner. Thus any change in taxation may potentially alter the existing pattern of real estate values, although the risk of this for tax-exempt institutions is limited to its overall effect on demand.