Q718

Q718 :I live in a rented accommodation, since I do not have a house of my own. I have earmarked a certain amount of my savings for the purchase of a plot of land to built a house. Since I have not been able to get the plot of land which meets my requirement, that amount of money is lying in the Bank. Am I supposed to pay zakah for it? I have also purchased some gold ornaments with the intention of giving them to my two sisters when they get married. In the meantime, the jewelry remains with me. Is it liable for zakah? If so, is there any way I may be exempt from paying zakah? I have given an amount of money to a relative of mine. I want that amount to be adjusted against my payment of zakah, fearing that he will not be able to pay it back. Can this be done? If so, am I supposed to inform him of the same?

A718 : What worries me in this letter is the clear desire to reduce one's liability of zakah to the minimum possible. In other words, the writer's approach to zakah is the same as any ordinary person's to taxes imposed by secular governments. I realize that in many countries, tax avoidance is accepted as legal while tax evasion is considered an offence. There are differences between the two, but the point here is the recognition by legal authorities and the desire and attempt to reduce one's tax liability are legitimate. The case is totally different with zakah. One must never forget that zakah is an act of worship. It is true that it is a financial transaction, but one pays it out when it is due, because of the reward one expects to receive from Allah for having paid it. One may say that since Allah has given us our money and He has imposed on us a duty to pay zakah, we do nothing to deserve any reward when we pay it out. That is not Islamic view. When one does what Allah has bid him to do, he is rewarded for his compliance and obedience. Quite apart from all the social benefits which the payment of zakah brings to an individual and a community, the fact that zakah payment is an act of worship, which is rewarded by Allah, should make every one of us keen to pay it when it becomes due. Moreover, a person who does not have enough funds to be liable to pay zakah feels that he misses out on a source of reward which enhances his standing on the day of judgment. All this goes to show that we should not look for ways and means of reducing the total sum of zakah which we need to pay out, but we should pay our zakah willingly, hoping for reward and expressing our gratitude to Allah for having given us enough to satisfy our need and to be able to hold some savings which put us above many of our brethren. When we do that, Allah is sure to give us more and He rewards us. Although you have earmarked some of your savings for the purchase of a piece of land, and despite the fact that such a building plot is not added to your possessions, these savings are not exempt from zakah. When you have bought the land and constructed the house, you pay nothing in zakah against either the land or the house, unless you let it out. In that case, you pay on the rent you receive from it. If you use it for your own accommodation, it is not liable to zakah. That applies, however, when the land is bought and the house is constructed. It cannot apply in advance. You may be totally committed that you will not use savings for any reason other than your house construction. But you realize that, faced with a pressing emergency, you may find these savings handy and spend them without waiting for the house or the land. There is no way that cash in the bank, held as savings, can be exempted from zakah, when you own more than the threshold of zakah, for any reason. Whatever purpose one intends to use the money for, the liability remains the same. The jewellery you have purchased for your sisters is your own. It is true that you have no use for it except to give it to your sisters when the occasion arises. But until then, the jewellery is yours. Therefore, it must be calculated as part of your property. Women's jewellery, when they are within reasonable limits, are exempt from zakah. That is because they use the jewellery and they do not hold it as savings. However, a woman must pay zakah for her jewellery if she considers it a method of saving. However, if you give that jewellery to your sisters, without waiting for their marriages to take place, the situation becomes different. It becomes part of their property. Zakah liability is applicable to each man and woman separately. Therefore, each of your sisters is treated on her own. Each of them has to look after her own zakah. If you pass on the jewellery to them, they need not pay zakah for it, as long as it is within what is considered to be reasonable for women in their social status. Having said that, I must explain that when you give this jewellery to your sisters, the transaction must be a serious one. They must know and you intend that the jewellery becomes their own property which they use as they think fit. You will have no further claim to it, except inasmuch as you have a claim to any sum of money which either of your sisters has earned or inherited. While the jewellery remains with you, you know that you can sell it to meet an emergency. You may decide that facing such an emergency is more important for the present, and that you will be able to buy something else for your sisters when their marriages are to take place. But if you give them the jewellery, you cannot do that. If that is clear in your mind and theirs, and you actually give them the jewellery, then you need not pay zakah for it. Had you, when your uncle asked you to lend him some money, made a quick calculation and came out with a portion of your expected zakah liability and gave it to him as a gift, that would have been fine. It is permissible to pay zakah in advance. Therefore, if you pay it to someone in need when he actually needs it, that is well and good. Similarly, giving someone a loan to meet certain needs is a highly commendable act. As Muslims, we do not expect to receive interest on such loans, and actually refuse to take it when offered. Lending to someone in need is an action which cements social relations. Allah rewards us for such actions. Scholars differ as to when the zakah for loans is paid. There is no disagreement that the creditor is the one who is liable to pay zakah for the amount of the loan. However, he should pay it out regularly if he knows that the debtor is sound financially and that he will undoubtedly pay his loan. If one has some doubts about being paid back what he has lent, then he commits no sin if he does not include the amount of the loan in his calculation of his liability for zakah. When he is actually paid back, he immediately pays out the zakah due for the amount of the loan, if the date of his payment of zakah has already passed. You can certainly do that if you fear that your uncle might not be able to pay you back for a long time to come. However, what you cannot do is to make a set off of the loan against your zakah. You cannot say to your uncle that he need not pay you back because you intend that what you have given him constitutes a payment of zakah. Here you are paying zakah to yourself. What you can do is to pay your uncle some or all of your zakah as a gift, without giving him the slightest hint that you expect him to use the money to pay you back your loan, that is well and good. If not, you must not have any hard feelings because he actually commits no offence if he uses it for other legitimate purposes.

Our Dialogue ( Source : Arab News - Jeddah )