TaxAdministrationDarling to swoop on Sharia loophole

Darling to swoop on Sharia loophole

The chancellor is set close a loophole in Sharia finance rules which avoids stamp duty on commercial property

Chancellor Alistair Darling is expected to close a loophole in Sharia finance
rules which has enabled commercial property investors avoid paying stamp duty on
more than £1bn of deals, The Times reports.

Next week’s budget could tighten rules on mortgages which comply with Islamic
law after commercial property developers discovered a quirk in the legislation
which enabled them to escape stamp duty.

The 2005 Budget brought in measures to correct the anomaly but
unintentionally created a tax avoidance loophole property developers have
flocked to exploit. More than £1bn of commercial property deals over the past
two years have escaped stamp duty at 4%.

Senior city tax lawyers, commercial property agents and a head of asset
finance for one of Britain’s biggest banks all say increasing numbers of office
sales valued from £50m to £100m or more have been using the latest
Sharia-compliant financing to take advantage of the loophole, although many of
those buying and selling the properties have no cultural imperatives to use
Sharia.

Further reading:

Treasury hopes to make UK ‘gateway to Islamic trade’

Read
story in The Times

Related Articles

LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

5d Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

3w Emma Smith, Managing Editor
HMRC issues updated Trusts Registration Service guidance

Administration HMRC issues updated Trusts Registration Service guidance

3w Emma Smith, Managing Editor
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

2m Emma Rawson, ATT Technical Officer
‘Improve rather than lose’ disincorporation relief, tax body urges

Administration ‘Improve rather than lose’ disincorporation relief, tax body urges

3m Austin Clark, Reporter
Are you ready for the Trusts Registration Service?

Administration Are you ready for the Trusts Registration Service?

3m Helen Thornley, ATT Technical Officer
Advisers bullish despite Brexit concerns

Accounting Standards Advisers bullish despite Brexit concerns

1y Fraser Simpson, Reporter
Brexit: Five questions accountants should be asking

Accounting Firms Brexit: Five questions accountants should be asking

1y Fraser Simpson, Reporter