Category

Fatawa
Question: What is the Zakat on a Shariah-compliant investment account based on Wakalah? In the Name of Allah, the Most Gracious, the Most Merciful. As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.  The Answer: Zakat on a Shariah-compliant investment account depends on the nature of the investment. If such investments are made into Shariah-compliant money market products, the entire...
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Question: Is there Zakat on an investment in a start-up company? In the Name of Allah, the Most Gracious, the Most Merciful. As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.  The Answer:  Zakat on a start-up depends on the underlying net Zakatable assets of the company. An investor will pay Zakat (2.5%) on the percentage of shareholding in net...
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Question: What is the Zakat liability on a fixed-term annuity? In the Name of Allah, the Most Gracious, the Most Merciful. As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.  The Answer:  Zakat is not due on the total amount in a fixed annuity yet to be received. The Fiqh (jurisprudence of the answer): An annuity is a contract between you and...
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Question: How are raw materials, inventory and finished goods valued for Zakat? In the Name of Allah, the Most Gracious, the Most Merciful. As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.  The Answer: 1. Raw material – for Zakat purposes, will consider its current value (usually difficult to determine, so may use cost price alternatively)  2. Work in progress...
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Question: What is the Zakat treatment for prepaid expenses? In the Name of Allah, the Most Gracious, the Most Merciful. As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.  The Answer: The prepaid sum is no longer in one’s ownership and as such, it is not Zakatable. Prepaid expenses are future expenses that have been paid in advance. In other words, prepaid expenses are costs that have...
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Question: Is Zakat due on Sukuk al-Ijarah investments? In the Name of Allah, the Most Gracious, the Most Merciful. As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.  The Answer: Ijarah Sukuk is based on an underlying Ijarah structure. Certificates are issued by a special purpose vehicle that entitles the holders to an ownership interest and a right to a return in proportion to...
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In the Name of Allah, the Most Gracious, the Most Merciful. As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh. The Answer: Retail conventional Forex trading, where individuals are merely speculating on currency pairs, is non-Shariah Compliant. Brokers which offer Islamic FX accounts advertise their product with ‘no rollover/swap fees’. What is more important to determine is whether or not...
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This is an overview and my personal conclusion to an ongoing research in respect to Bitcoin. References and detailed analysis can be viewed in my previous papers. After researching the issue of Bitcoin initially and releasing papers on the topic, I have received feedback from several colleagues from the Islamic finance industry, fellow Shariah advisors...
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Question: Can a counter-party’s silence upon an offer be considered to be acceptance? In the Name of Allah, the Most Gracious, the Most Merciful. As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.  The Answer:  The silence of the counter-party without any statement or action indicating to acceptance is not regarded as acceptance in commercial transactions[1]. The Fiqh (jurisprudence of...
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Question: How to Treat Surplus From Sale of a Collaterised asset In the Name of Allah, the Most Gracious, the Most Merciful. As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.  The Answer:  Any surplus proceeds in excess of an outstanding debt realised from the sale of a collaterised asset must be returned to the debtor. They are an Amanah...
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