The emergence of Islamic finance is one of the most interesting developments in the recent history of the global financial services sector.
Islamic finance houses recognise that their market is not confined to predominantly Muslim-populated countries and are beginning to operate and compete on an international basis.
Ireland is a well-established and successful financial services centre. Keeping up with its tradition of playing a proactive role in the development of the financial services sector, Ireland is opening its doors for Islamic financial institutions, allowing them to avail of its unique economic offerings that include the following:
- Highly Favourable Fiscal Environment – 12.5% corporate tax rate, rich network of tax treaties, tax neutral funds regime
- Highly Developed Business Environment – Member state of the European Union and Euro-zone
- Regulatory Regime – Irish regulated financial services entities can provide their services across the European market
- Excellent Professional Services Infrastructure – Robust legal system, the only English speaking country within Euro-zone
The Irish Financial Regulator has set up a dedicated team to deal with the establishment of Shari’a compliant investment funds. The Irish Revenue authorities have comfirmed that Shari’a compliant funds, leases and insurance arrangements should be taxed under the same principles as those applicable to their respective conventional counterparts.
Recognising the growth in this sector and the requirements of our clients and the wider market, KPMG in Ireland has set up a cross-functional team of 25 professionals that can advise on all areas of Islamic finance, including:
- Assistance in setting up regulated financial services entities, including Shari’a compliant funds, Islamic financial institutions (such as banking companies, investment banks, Shari’a compliant mortgage houses and leasing companies); Takaful, Family Takaful and ReTakaful companies; and Sukuk entities
- Audit services for Shari’a compliant funds and Islamic financial institutions
- Taxation advisory services relating to Shari’a compliant transactions and structures, including transfer pricing analysis on cross-border transactions
- Financial advice, including feasibility studies, market analysis, due diligence, and valuations.