We combine knowledge of Islamic financing techniques with an understanding of the complex tax rules to assist clients to develop Sharia’a compliant financial products.

We have advised our clients on the corporate tax, VAT and withholding tax implications of various Islamic finance products and have extensive experience of determining the tax treatment on a product-by-product basis.

For corporate tax purposes, it is necessary to assess whether each product falls within the provisions of existing legislation or not. Where it does not, we have experience of agreeing the treatment with HMRC.

The client will need to consider VAT on each new product and transaction on the basis of existing VAT legislation. As Islamic Finance is a new area, HMRC are uncertain on the VAT treatment of many products. However, generally speaking, trading certain products in a certain way can lead to enhanced input tax recovery. Also, potential output tax exposures can often be mitigated with careful structuring.

If you would like to discuss your requirements please contact a member of the Islamic Finance team on
+44 (20) 7007 4914 or via email.