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Session Details
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| Guest Name |
Dr. Monzer Kahf
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| Profession |
Scholar in Islamic Economics & Financial Expert
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| Subject |
On Financial Issues
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| Date |
Tuesday,Sep 1 ,2009
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Time |
Makkah
From...
14:00...To...
15:30
GMT
From... 11:00...To...12:30
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| Name |
Host
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| Answer |
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
Brothers and sisters, the session has already started. You can submit your questions. Please, make your questions short and clear so as to help us answer all your questions.
Yours,
Islam Online Fatwa Editing Desk.
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| Name |
Imran
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| Question |
I own an exhibition organizing company. We organize a trade exhibition where IT managers of conventional and Islamic banks meet and do business with IT companies who provide software solutions for banks and financial institutions.
Our income is generated by renting exhibition space to IT companies.
Is this business and the wealth accumulated from it permissible?
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| Answer |
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
Yes, this is permissible as long as you do not rent spaces to companies/individuals specifically for using the space to offer prohibited services. In your case, it is not of your concern what they sell to banks, offering IT systems is not prohibited.
Allah Almighty knows best.
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| Name |
Mohammed Abdul Mannan
- Saudi Arabia
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| Profession |
IT
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| Question |
As-salamu alaykum.
I have given loan to different people , do I have to pay zakat on that amount?
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| Answer |
Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
Loans that you give to others are part of your wealth as long as these loans are on persons who are able to pay them back and not been legally disputed. You are rich by owning these debts on others. They are definitely subject to Zakah every year as a part of one's wealth.
Allah Almighty knows best.
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| Name |
Furquan
- Saudi Arabia
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| Question |
What is the rule of annual Zakath; Please give full details including properties which are not used by us and also not getting any benefits from them.
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| Answer |
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
The principle is that zakah is on the rich and to the poor. All items that one owns and by owning them one is considered rich are subject to Zakah. The mercy of Allah granted us certain exemptions on items that are assigned for personal and family use. Consequently, all items that are intended for business, investment, profit or revenue creating, or just wealth accumulation are subject to Zakah. In contrast, residence house, even it may be vast, vacation house that is left only for personal and family use, transportations cars or plains that are for personal and family use, furniture, and other personal items are not subject to Zakah. Savings and investments in all their forms are subject to Zakah.
Zakah is required to be paid every year even though it was paid the past year on the same item of wealth. Jewelry that are used by owner and family are not subject provided they do not exceed the normal amount relative to peers.
Getting benefit of an item or not is not relevant to its Zakatability. An owner of large sum of investment is still required to pay Zakah even if she/he makes losses of half of her/his wealth as long as he/she is still own an amount of Nisab at the end of the year.
Allah Almighty knows best.
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| Name |
Mohsin
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| Question |
Assalamu Alaikum. I have been hearing about Islamic Banking services in Arab countries. I studied about it formally and came to know that one of the prime functioning of these banks, was that of the 'Murabaha'. My question is, how does the car loans and other products offered by conventional banks, differ from the Murabaha concept of Islamic banking, while the former calls its collection of excess money (of a vehicle, for instance) from the market prize as interest, and the latter (Islamic banking system) calls it some other name. What output difference does the two have? If there is no practical difference, then how is it that we are able to tell our system of banking is free of interests offered by the conventional banks? Please help me understand the concept. Your efforts are appreciated and may Allah guide us in the right path. Wassalam Alaikum
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Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
Dear Brother you still need to make some further study... It is not easy to explain this complicated matter in a few line of Fatwa.
In brief, a commodity has different prices, genuinely depending on the date of payment and date of delivery. The cash price of a commodity is not the same as its price when payment is deferred. That is the basis of Murabaha. On the other hand a debt does not have the same characteristic because a debt does not create any intrinsic utility. Interest is an increment in a debt, while the mark up profit in Murabaha is a price differential caused by the deferment of payment.
Our Shari`ah does not prohibit financing; it prohibits financing through lending on interest.
The result of this difference is not as small as one may quickly think. Eliminating financing through loans and channeling it only through Murabaha means that all financing shall be for real transactions, for goods moving from one hand to another. That is real development. When you do it through loans that is not necessarily the case. We noticed in the current crisis that there were many pure debt transactions that caused the melt down and its spread, these transactions do not take place under Murabaha. For more info please make more reading or take a class in Islamic finance.
Allah Almighty knows best.
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| Name |
am
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| Profession |
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| Question |
Can I take an interest based loan for higher study as the job that I am currently doing does not have the right environment and involves mixing with the other gender quite often. I can't leave the job as my family is used to the current earnings and life style.
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| Answer |
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
The answer is NO because there is no necessity for that and what you hope for may not materialize even with the loan.
Allah Almighty knows best.
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| Name |
Imran
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| Profession |
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| Question |
I own an exhibition organising company. We organise a trade exhibition where IT managers of conventional and Islamic banks meet and do business with IT companies who provide software solutions for banks and financial institutions.
Our income is generated by renting exhibition space to IT companies.
Is this business and the wealth accumulated from it permissible?
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| Answer |
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
This question is answered earlier.
Allah Almighty knows best.
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| Name |
fADI
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Assalamu alaikum. I have some questions about zakat on wealth (not zakat alfitr): basically every year on the last day of Ramadan, I calculate all the wealth I have (in cash, stocks, and wife's gold holding) and apply the 2.5% to calculate the zakat. However, as I live in Belgium, I usually send the money to my dad in Lebanon and he distributes it to needy relatives (not direct parents or descendents of mine). That means the money is actually paid later than the last day of Ramadan when I calculate my zakat. Recently I found some articles that say zakat shouldn't be delayed and should be paid on the day it reaches the hawl (1 year). So the questions are: 1- can the day zakat is calculated on be different than the day it's paid? I remember I read somewhere that I have up to 1 year (before next zakat calculation) to pay it. Is this correct? 2- If this isn't correct, it's very hard for me to do the calculations all in one day and pay the zakat. Reason is that I have to wait until stock market closes to get the exact value of my stocks, also I have to find out the value of gold on that day, and then I have to ask my dad to pay the money from his bank account while I transfer this to him. 3- If the value of my stocks went below the nisab during the current year, do i still have to pay zakat on it? 4- Some of my individual stocks were below the nisab this year, do I calculate the zakat on each individual stock which was above the nisab? Or this is not allowed and I should calculate the total worth of the stocks and pay zakat on that? Jazakum Allah khayran.
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| Answer |
Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
For Nisab and for calculation of Zakah you add all your investment together not every item alone. For payment of Zakah the principle is that it should be paid on the due day that is the end of the lunar Hawl (year). But delaying it for good reason such as sending it to needy relatives is permissible. While delaying for no reason is sinful.
Allah Almighty knows best.
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| Name |
Yassin
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| Question |
Assalmou alaykoum. I bought a land 6 month a go with my savings. Before I bought the land I had the money in my saving account for 6 month. Its 12 month now since I had the money and bought the land I found out after 6 month that there is a problem with planning permissions also a legal action has been taken against the person who sold the land to me by a neighbor due to land boundary's dispute, I have asked the seller to give me back my money. What I would like to know is do I have to pay ZAKAT when I get my money back from the seller, because its 12 month since I saved the money and had the land.
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Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
If the land you bought was to build your own residence on it you are not subject to
Zakah and when you get Nisab (# $1500) once again you start a new Hawl. If the land for purpose of making money by sale or build and sale, your Zakah year continues from the first time you got the Nisab, as you say 12 month ago and you should pay zakah on the value of the land (or the money you paid if the contract is annulled or cancelled), it is due on the day you complete 354 days from the first day you acquired Nisab.
Allah Almighty knows best.
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FA
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Respected scholars, As-salamu alaikum. PTC (Paid to click) sites can provide some extra income for me, where I am able to join the site for free and get paid for viewing several advertisements provided by the site. Most of the sites may have some advertisements for casinos or alcohol or other prohibited things by our religion. First question is: can I avoid those advertisements and still be able to earn from that site? Or do I have to avoid those sites which allow prohibited advertisements? Those sites will give me a commission for referring other people to the site, and the site will give me commission every time my referral (the person I referred to the site) views advertisements on the site (e.g. 5% of his views earnings - note that this percentage is not deducted from his account but is given to me by the site), of course this means that if my referral stops clicking at that site, I wont earn any more commission (as long as he clicks and earns I will earn the commission). They also offer upgrades where I pay a certain amount of money to increase that commission for a set amount of time (e.g. 20$ to raise the 5% to 50% for a year) so that now the site will automatically award me 50% instead of the 5% for a year. Also note that this upgrade sometimes include privileges to its buyer like having the priority for payment or having a lesser minimum for his payment request. Is this upgrade halal? One last thing is that the site sometimes offers referrals for sale where I can buy referrals to be placed under me as if I referred them to the site and I will be taking commission from the newly bought refs' views' earnings. Is buying the referrals halal? Jazakum Allahu Khayran
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Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
It seems that this kind of thing has a lot of mess. Of course, buying referrals is not permissible because it means nothing in real life; this is not a thing that can be traded, it is fake! Also paying more money for increasing commission is not permissible too, it is form of Riba, money for money! Viewing permissible site or permissible views on sites that also show non-permissible views is permissible and it is permissible to get money for that. But this is a job of the idle and one should avoid this kind of earning because it adds to one's nothingness and wasting time.
Allah Almighty knows best.
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| Name |
ZA
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AOA Brother, Please respond to my following questions on zakat for clarifications. 1. Is there any limit for Gold/Silver to pay Zakat? 2. Zakat on 401 K plan, is Zakat on recent value, means after paying 20% penalty? 3. Money in saving account for emergency situation, means loosing job etc.? 4. Any monthly mortgage is affected by Zakat? Thanks a lot Brother
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| Answer |
Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
Wealth, whether in form of cash, bank accounts, savings at home, investment in financial markets, trade business, et., is subject to Zakah. You add all these items together to calculate the Nisab; the amount of Nisab is approximately equivalent to US$ 1500. You do not deal with each item (such as gold, silver, business networth, stocks, etc.) alone, these are additive items all together. Your Zakah year begins on the day you acquire Nisab for the first day.
Funds in 401K are subject to Zakah on the balance that is shown in your account provided all of it is vested (non-vested amount is deductible because it is not yet owned by you), you do not deduct penalty or tax because you did not pay it, did you? If you pay penalty and tax the money is no more in 401K it is already withdrawn then because penalty and tax is due only on withdrawal. And when you choose investment or broker you tell him to invest the balance not the balance minus potential penalty! You always take the value of 401K investment on the due day of your Zakah.
Finally money for emergency is also part of your wealth, what is wealth for other than emergency? It is subject to Zakah and should be included in the calculation. Do not segregate your wealth!
Allah Almighty knows best.
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| Name |
Haq
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There is a difference of opinion between Ulema on the permissibility of working at a conventional bank. Some ulema allow working in positions where one is not directly involved in writing or witnessing Riba contracts. However, other Ulema totally prohibit working in a bank, even as a security guard. Given this difference of opinion between Ulema, should we follow the view that is more convincing or one that is more convenient?
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In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
You follow what your heart and conscience feel comfortable with.
Allah Almighty knows best.
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| Name |
murad
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| Question |
Asalamualeykum
What is zakah for open land purchased?
Thanks
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Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
What do you mean by open land purchase. If it is a land you own as a part of your wealth and it is not assigned for building your own residence, it is subject to Zakah like any other item of your wealth.
Allah Almighty knows best.
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| Name |
Muhammad Anwar Mahesar
- Pakistan
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| Profession |
Engineer
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| Question |
I have two wives. 03 daughters and two sons from one wife and 03 daughters from other wife. What share/percentage be for each wife in my provident fund and other benefits?
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In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
Provident funds and other death benefits may have their own regulations that do not have to follow the inheritance distribution. This is permissible in Shari'ah for benefits that the deceased did not own. In other words, benefits that are due as a result of the incidence of death are not due to the deceased but to the beneficiaries that are either determined by law or by personal preference of the deceased. They are not subject to inheritance because they were not a property of the deceased. As having two wives you must treat them equally, if you have a choice of determining the beneficiaries of your death benefit. The share of a wife is different from the share of a child (both under special rules of death benefits and under inheritance) shares of children will from your death benefit and from your estate as inheritance will be equal for the girls and for the boys regardless of their mother from either wife they are. They are all to you just children.
If the Providence funds is of the kind that you own your money it is while alive then every thing must be distributed according to inheritance: each wife takes 1/16 on net estate, and if you have no parents the remainder with be distributed to your children for a male twice as much as for a female.
Allah Almighty knows best.
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muneer
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Salam dr.
Can I give zakat to my uncles and aunts?
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Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
Yes because basically you are not responsible for their living expenses.
Allah Almighty knows best.
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| Name |
Muhammad
- United Kingdom
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As-Salamu `alaykum. I am renting at the moment and now I want to buy a house in UK for my family and better living. There is only one Islamic bank which provides the Halal house finance; Ijara (leasing) and Diminishing Musharaka (reducing partnership) based. But I don’t meet their eligibility criteria due to my visa status, I might be able to meet this criteria in next 3- 4 years (not guaranteed). On the other hand other non Islamic banks which provides the non-Islamic mortgage, they are not only accepting my current visa status but also offering me the better deal. I have the following questions to ask
- Is above mentioned Halal Finance Method is acceptable according to Islam?
- In my situation what do you suggest me, do I wait for 3 – 4 years before I buy a house?
- Or I can buy a house now with non-Islamic Mortgage and when I become eligible for Halal Finance then I can transfer to it? Keeping in mind there is no other Islamic Solution available at present.
May Allah give you reward for it. Jazakum Allahu khayran.
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Wa `alaykum As-Salamu wa Rahmatullahi wa Barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
If you do not meet the requirement of the Islamic finance to you then there is no Islamic finance available. This leaves you to the Fatwa on permissibility of buying on conventional mortgage when the Islamic finance is not available.
Allah Almighty knows best.
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Editor
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In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
Brothers and sisters, the session has already started. You can submit your questions. Please, make your questions short and clear so as to help us answer all your questions.
Yours,
Islam Online Fatwa Editing Desk.
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| All Fatwas published on this website (Islamonline.net) represent the juristic views and opinions of eminent scholars and Muftis. They do not necessarily form a juristic approach upheld by this website. Click here to read Full Disclaimer. |
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