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Live Fatwa (Financial Issues)

Prof. Dr. Monzer Kahf
09 August, 2016

Dear Brothers/Sisters,

Thank you very much for joining us in this Live Fatwa session. We would like also to thank our guest, Dr. Monzer Kahf, for answering the questions directed to him. You will find the answers of your questions below.

Wednesday, Aug. 10, 2016 | 18:00 - 20:00 GMT

Session is over.
DISCLAIMER
Views expressed by hosts/guests on this program (live dialogue, Facebook sessions, etc.) are their own and their appearance on the program does not imply an endorsement of them or any entity they represent.  

You might have known about the bad financial conditions in Egypt, especially for traders and businessmen. Under such circumstances, is it allowed for a businessman to lie about his income to decrease the tax he ought to pay?



Dear Br.

Lying is not permissible but declaring part of the income that is documented and not telling about all income is permissible in my opinion.

 

This is a civil matter not a religious one (except for plain lying which is not permissible religiously).

 

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This applies to all countries in matters of all taxes; nothing special for Egypt now or in other times.

 

Allah Almighty knows best.

I’m obliged to open a bank account so that the company where I work can transfer my salary to it. Also, my pension from earlier official work, from which I had retired, is transferred to this account. Really I’m not comfortable with this. Could you kindly enlighten me if it is OK according to Islam’s rulings?



Dear Br.

Opening a checking account that does not generate interest is permissible because you do not earn or give any interest. It has become a necessity in our times as you notice in your case. We all deal with conventional banks and we make our best to avoid interest.

 

However, if there is an Islamic bank in your area, it is much better to deal with it because even when you have only a checking account, the bank may use your money anyway.

 

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Allah Almighty knows best.

I know a retired widow whose financial advisor is strongly recommending that she invest in them because it will give her a guaranteed income.60% of the annuity is invested in equity and 40% is fixed income, which we know is not halal. So, she is thinking that she can give 40% of the income that she receives from this annuity as sadaqah.Given this plan, is it halal for her to invest in the variable annuity?



Dear Br.

 

It is meaningless and rather sinful to intentionally earn haram and give it to charity.

 

This widow shall be as good keeping 40% cash (not earning and not giving sadaqah) and investing only the 60% in equity, of course provided the shares she selects are themselves Shari`ah compliant.

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Allah Almighty knows best.

As-salamu alaikum. Usually I pay Zakah after Ramadan. This year in March I bought a flat, according to the agreement I paid 30%, and I have to pay the entire amount in September. So should I pay Zakah from that money which I still have to pay for the flat if I have had them in my hand for the whole Zakatable year?



Dear Sr.

If the flat you contracted (bought) is for your residence, it is not subject to Zakah and all funds that you are saving and putting together to pay the remaining 70% of its price is also not subject to Zakah, because they are prepared to pay the debt that is now on you.

 

But if the flat is for investment, its market value on the day of Zakah is subject to Zakah and you should deduct, from the market value, the amount of debt that is still on it (the 70%), i.e., you take the net equity only and that is subject to Zakah.

 

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Of course any funds you have cash and accumulate until September or any other date will also be subject to Zakah as cumulative cash.

 

Notice; we did not do any double Zakah or any double deduction.

 

Allah Almighty knows best.