IslamicFinance.de

According to most fund managers, people usually invest in equities. FTSE 100 companies dominate portfolios and provide the assets under-pinning financial products using pension or other similar investments. However, a closer look at these companies shows that many of them are involved in activities and products such as alcohol, gambling and entertainment which puts them out of bounds to Muslim clients. Sharia law excludes many mainstream financial products and investments from the practices of these companies.

The UK Government has committed to create a level playing field on VAT for retail investors in Islamic finance products. In his Pre-Budget Report statement, the Chancellor, Alistair Darling, says he will also provide relief from tax on capital gains for alternative property refinance transactions to maintain the UK's position as a centre for Islamic finance.

In addition, guidance will be issued on VAT treatment of alternative finance investment bonds.