Judgment of Zakah

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Judgment of Zakah
Judgment of Zakah
Zakah is the third of the Five Pillars of Islam. Denying it leads to disbelief and Muslims are commanded to fight those who abstain from paying it. Its legality dates back to the second year after Hijrah. It is mentioned in the Qur'an more than once. The Qur'an says, "And be steadfast in prayer; practice regular charity; and bow down your heads with those who bow down (in worship)" . (Surah Al-Baqarah 2:43). The Qur'an also says, "And those in whose wealth is a recognized right for the (needy) who asks and him who is prevented (for some reason from asking)" . (Surah Al-Ma`arij 70:24-25.

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Wisdom of its Legality
Zakah is indispensable for the Muslim community as it achieves reform, both financially and spiritually. It eliminates misery and greed from hearts and consolidates the Islamic economy, leading to its stability and prosperity. Besides, the Qur'an pictures Zakah as: * The means of attaining Allah's mercy, "But My Mercy extendeth to all things. That (Mercy) I shall ordain for those who do right, and practice regular charity" . (Surah Al-A`raf 7:165). * A precondition to achieve victory, "Allah will certainly aid those who aid His (cause); for verily Allah is Full of Strength, Exalted in Might, (able to enforce His Will). (They are) those who, if We establish them in the land, establish regular prayer and give regular charity." (Surah Al-Hajj 22:40-41). * A sign of brotherhood in religion, "But (even so), if they repent, establish regular prayers, and practice regular charity, they are your brethren in Faith." (Surah Al-Taubah 9:11). * A distinctive feature of the faithful community, "The Believers, men and women, are protectors, one of another: they enjoin what is just, and forbid what is evil: they observe regular prayers, practice regular charity, and obey Allah and His Messenger. On them will Allah pour His Mercy: for Allah is Exalted in power, Wise." (Surah Al-Taubah 9:71). * A distinctive quality of the believers who frequently go to mosques and maintain them. "The mosques of Allah shall be visited and maintained by such as believe in Allah and the Last Day, establish regular prayers, and practice regular charity, and fear none (at all) except Allah." (Surah Al-Taubah 9:18). * A distinctive quality of the true believers who will abide in Paradise, "Who are active in deeds of charity." (Surah Al-Mu'minun 23:4).
* Also the Sunnah equally stresses the importance of Zakah. Ibn `Umar (may Allah be pleased with him and his father) reported Allah's Messenger (peace be upon him) as saying, "I have been commanded to fight against people till they testify that there is no god but Allah, and that Muhammad is the Messenger of Allah, perform Prayer, and pay Zakah." * It is reported on the authority of Jarir (may Allah be pleased with him) that he observed, "I gave pledge of allegiance to Allah's Messenger (peace be upon him) on the observance of Prayer, payment of Zakah, and sincerity and well-wishing for every Muslim." * Ibn `Umar (may Allah be pleased with them) reported that the Holy Prophet (peace be upon him) said, "(The superstructure of) Islam is raised on five (pillars): Bearing testimony that there is no god but Allah and that Muhammad is the Messenger of Allah, performance of Prayer, payment of Zakah, Pilgrimage (to Mecca) and Fast of Ramadan." (All the above hadiths are included in Sahih Al-Bukhari and Sahih Muslim)

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Judgment of withholding Zakah
A person who denies Zakah is considered a disbeliever. First there must be an attempt to correct him. If he insists on his denial, he must be killed for disbelief. However, an allowance must be given to the person who recently converted to Islam on account of his ignorance of its principles. He must be directed until he abides by and acknowledges the giving of Zakah. As for one who though acknowledges the obligation to pay Zakah but abstains from giving it, he only incurs sin without being considered a disbeliever. Rather he should be given a discretionary punishment and forced by the ruler to pay Zakah. If a powerful group of people abstains from paying Zakah though acknowledging its legality, they must be fought until they pay it. This is confirmed by Abu Hurairah's narration that, "When the Messenger of Allah (peace be upon him) deceased and Abu Bakr was appointed Caliph, some Arab tribes became apostates. `Umar said to Abu Bakr, "Why would you fight these people while Allah's Messenger (peace be upon him) said: I have been directed to fight against people till they testify that there is no god but Allah. Whoever professes it is granted full protection of his property and life except for a right cause and his (other) affairs rest with Allah?" Upon this Abu Bakr said, 'By Allah, I would definitely fight against those who make a difference between Prayer and Zakah, for it is the obligation upon the rich. By Allah, I would fight against them even if they withheld a cord (used for hobbling the feet of a camel) which they used to give to Allah's Messenger (peace be upon him) (as Zakah).' `Umar said, 'Then I became convinced that Abu Bakr was right.'" Abu Hurairah (may Allah be pleased with him) also reported that Allah's Messenger (peace be upon him) said, "The owner of gold or silver who does not pay the poor due (Zakah) will have a bitter punishment on the Day of Resurrection. Plates of fire will be beaten out for him; these will then be heated in the fire of Hell and his sides, forehead and back will be cauterized with them. Whenever these cool down, (the process will be) repeated throughout a day whose extent will be fifty thousand years until Judgment is pronounced among the servants, and he sees whether his path is to take him to Paradise or to Hell." `Abdullah bin Mas`ud (may Allah be pleased with him) reported Allah's Messenger (peace be upon him) as saying, "There is no owner of property who does not pay Zakah but it (his property) will turn into a bald snake and enclose his neck. (The Prophet, peace be upon him) then recited, 'And let not those who covetously withhold of the gifts which Allah hath given them of His Grace, think that it is good for them: nay, it will be the worse for them; soon shall the things which they covetously withheld be tied to their necks like a twisted collar on the Day of Judgment.'" (Surah Aal `Imran 2:180). `Ali (may Allah be pleased with him) reported, "Allah's Messenger (peace be upon him) cursed the one who accepts or gives interest, the one who witnesses to it and the one who records it; (and cursed) the female tattooer and the woman who gets herself tattooed; (and also cursed) the one who withholds Sadaqah (Zakah), the Muhallil (the one who marries an irrevocably divorced woman then divorces her with the aim to return to her previous husband) and the Muhallal Lahu (the one who irrevocably divorces his wife and gets her married to another then divorced from another man in order to marry her again."

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Conditions of the Obligation of Zakah
Conditions of Zakah
Islamic Shari`ah laid down some conditions that must be realized to make Zakah due. These conditions were identified with the aim of granting some facilities to the owner, so that he might give Zakah willingly. Thus, Zakah achieves the noble aims for which it has been ordained. These conditions are:
Full Possession Real or Assumed Growth Fulfilling the Nisab (Minimum Amount Liable to Zakah) Fulfilling One's Basic Needs The Lapse of a Full Year Forbidding Twice Payment of Zakah at the Same Year

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Full Ownership
Full possession implies that the owner should be fully capable of disposing the property without being an object of contest by others. As Zakah is considered a kind of ownership as regards the receiver, the giver must purely own it. Thus, no Zakah is due on the property which is Dimar (that is not fully possessed, due to ignorance of its location or incapability to reach it). Some Companions are reported to have said, "Zakah is not due on a Dimar property, nor on the deferred amount of dower (as a woman cannot dispose of it) nor on the debt owed by an insolvent person." However, in case such kind of property becomes fully possessed, Zakah becomes obligatory on it for one year only, no matter how many years it remained out of reach.

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Growth of Wealth, Whether Real or Assumed
Real growth of wealth is that caused by its producing offspring, or by gain realized from trade. Assumed growth implies the liability of property, such as gold, silver and currencies to increase when exploited in trade. However, no Zakah is due on properties that are not liable to real or assumed growth.‏

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Reaching Nisab (Minimum Amount Liable to Zakah)
The method of estimating the Nisab (minimum amount liable to Zakah) is applicable to cash money, gold, silver, commercial commodities and cattle. According to a prophetic hadith, "Gold is not liable to Zakah unless it reaches twenty dinars. Once it reaches this amount, half a dinar must be paid as Zakah on it. Likewise, silver is not counted for Zakah unless it reaches two hundred dirhams. Once it reaches this value, an amount of five dirhams must be paid as Zakah on it." Based on this hadith the Nisab of gold counted for Zakah is twenty dinars (85 grams) of fine gold, while the Nisab of silver is two hundred dirhams (595 grams) of fine silver. The Nisab of merchandise is an amount whose value equals eighty-five grams of gold. No Zakah is due upon other kinds of property unless they reach their Nisab, which will be specified later on. Zakah becomes due upon reaching the Nisab or more than it. According to the Hanafi and Maliki juristic schools, the Nisab is calculated at the beginning and end of the year. Any decrease or insufficiency in between is overlooked. Any increase of property after reaching the Nisab during the year is to be included in the total sum counted for Zakah. This is considered the easiest and most applicable among the other juristic views, which has made the majority of scholars adopt it.
Khultah [Co-possession]
Khultah implies treating the property owned by two or more persons as that owned by only one person. This may result from the unity of type and conditions, such as the unity of pasture, watering place and enclosure if the property is sheep, or the unity of responsibilities, procedures and disposition in case of partnership. Though the concept of Khultah is often applied to Zakah on cattle, some juristic schools also applied it to other kinds of property such as crops, fruits and cash money. Thus co-properties are to be treated as a single unity making up the total sum on which Zakah is payable. For example, a flock of 45 sheep that is owned by three persons, 15 sheep each, is counted for Zakah, and one sheep is due, though treating each of the three persons individually would not reach the Nisab of 40 sheep.

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Exceeding One's Basic Needs
Properties owned to meet one's basic requirements such as houses, work tools, machines for industry, means of transport, and furniture are excluded from Zakah. The same applies to the money dedicated to the repayment of debts, since the debtor is in need of this money to relieve himself from imprisonment and humiliation. This leads to a conclusion that the money kept to meet the basic requirements is exempted from Zakah.

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The lapse of a full year
A property is not counted for Zakah unless after the lapse of a full lunar year right from the day it reaches the Nisab. In case the budget is linked to the solar year, the solar calendar can be applied provided that the percentage of Zakah is raised up to 2.577% instead of 2.5% so as to make up for the difference between the two calendars. However, this condition does not apply to fruits and other crops. The criterion for giving Zakah on these two specific kinds of property is mentioned in the Holy Qur'an, "Render the dues that are proper on the day that the harvest is gathered." (Surah Al-An`am 6:141). In the same line the majority of scholars agreed that the lapse of a full year is not a necessity to pay Zakah on minerals and extracted treasures.

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Forbidding Twice Payment of Zakah at the Same Year
Once Zakah is paid on a property, it absolves the owner, even though the property is then transferred to a type different from that on which Zakah had been paid. For example, when the crops or cattle are sold, thus transferred to cash money, this new type of property is not liable to Zakah in the same year in which Zakah is paid on the former type. This in fact leads to the repetition of paying Zakah, which is contradicted by the Prophet's hadith in which he observed, "There is no repetition of Zakah."
Public wealth, endowments and charitable properties
Zakah is not due on public wealth, since it is a common property owned by all individuals of the community, including the poor. Likewise, Zakah in not due on endowments and money dedicated to charitable purposes, such as charitable associations and funds, so long as they do not belong to a specific owner.

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Zakah on tender (gold, silver and currency)
Definition of legal tender:
The phrase 'legal tender' implies all currencies whether banknote or coins, no matter whether they belong to the country of the payer of Zakah or not.
Obligation of Zakah upon legal tender:
Zakah upon legal tender is supported by proofs from the Holy Qur'an, the Sunnah and the unanimous agreement of Jurists. The Holy Qur'an says, "And there are those who bury gold and silver and spend it not in the Way of Allah: announce unto them a most grievous penalty. On the Day when heat will be produced out of that (wealth) in the fire of Hell, and with it will be branded their foreheads, their flanks, and their backs, this is the (treasure) which ye buried for yourselves: taste ye, then, the (treasures) ye buried!" (Surah Al-Taubah No.9, Verse: 34-35).
As for the Sunnah, the Prophet said, "What you keep for yourself after paying the Zakah due upon it is not a hoard." The Prophet also said, "Owner of gold or silver who does not pay the poor due (Zakah) will have bitter punishment on the Day of Resurrection. Plates of fire would be beaten out for him; these would then be heated in the fire of Hell and his sides, forehead and back would be cauterized with them".
Throughout ages all Muslims unanimously agreed that Zakah is due on silver and gold, and thus the rule extended to all other types of currency by way of analogy. According to the statement No.9 issued in the third session of the Islamic Jurisprudence Academy in Jeddah: All paper currencies are considered potential money that has the purchasing power and receive all the legal rules applicable to gold and silver as regards interest-taking, Zakah, payment in advance and other rules.
The Nisab of legal tender
Zakah becomes duce once the property of a certain person reaches the minimum amount defined by Islamic law as liable to paying Zakah.
The minimum amount of gold or gold currency counted for Zakah is 20 mithqals (4.25 grams of fine gold).
The minimum amount of silver or silver currency counted for Zakah is 200 dirhams (595 grams). A silver dirham is equal to 2.975 grams.
The statement issued by the Islamic Research Academy, in its 2nd conference, stipulated that estimating the Nisab liable to Zakah on banknote, coins and commercial commodities should be based on their corresponding minimum amount of gold, since the value of gold is more stable than any other kind of property.
To determine the value of gold as opposed to the currency in use, one should consult an expert. Some researchers claim that choosing gold as a criteria for determining the value of currency is attributed to its being assumed as a cover fund, even partially, to support the banknote issued by any given country. Besides its being the basis on which the value of banknote is determined, gold itself is considered an international currency and a standard criterion to measure the value of all currencies in the world. However, it is established that the value of gold may vary in accordance with the change of time or markets.
According to the Hanafi Juristic School, the value of gold may be added to the value of silver so as to complete the minimum amount counted for Zakah. If still beyond the minimum amount, the value of commercial commodities may also be added. The Nisab liable to Zakah on cash, banknote and coins is to be determined according to its corresponding value of gold (85 grams of fine gold), based on the current rates of the country in which the payer of Zakah is resident. In case the gold is not fully pure, Zakah is to be paid on the net weight of gold after leaving out the weight of other substances.
On the 18 carat gold, for example, Zakah is to be paid after leaving out one-fourth of the total weight, representing 6 carats out of 24 carats.
On the 21 carat gold, Zakah is to be paid after leaving out one-eighth of the total weight, representing 3 carats out of 24 carats.
The same applies to the silver that is not fully pure.
Requisites of Zakah on gold, silver and currencies:
They are the same as those stipulated to pay Zakah, which have been explained earlier. (See: Requisites of paying Zakah)
The amount of Zakah payable on silver, gold and currencies:
The mount payable is a quarter of a tithe (2.5%).
How to calculate in cash the amount of Zakah on gold and silver
One who prefers to pay Zakah on gold and silver in cash may multiply the amount counted for Zakah by the rate of grams. This will give the amount of Zakah in cash. For example, in case the amount of gold liable to Zakah is 25 grams and a gram value is 4 dinars, we may reach the amount of Zakah payable in cash by making use of the following equation: The amount of Zakah = 25 grams (of gold) x 4 dinars (the rate of gram) = 100 dinars.

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Zakah on ornaments and gold and silver objects:
Though ornaments worn by women are not counted for Zakah, there must be criteria for defining the value of these ornaments. Such value is estimated according to the standard of living. However, ornaments kept for purposes other than wearing are inevitably counted for Zakah. Likewise all ornaments that are not in current use due to their being out of fashion are counted for Zakah.‏
Zakah is due on fine gold and silver in case either of them reaches a certain weight. Value fluctuation of gold and silver due to molding, manufacturing or containing precious stones is overlooked.‏
However, gold and silver invested in trade are estimated according to their value, including molding, manufacturing and precious stones.
Zakah is obligatory on gold and silver ornaments unlawful to wear:
Such unlawful ornaments may include gold bracelets and watches worn by men and the ornaments for men when used by women.
Zakah is obligatory on unlawful gold or silver ornaments so long as they reach the allotted Nisab, or when added to other jewelry. The Nisab of gold and silver possession has been previously explained. Legal tender may be added to the value of gold and silver in calculating Zakah money. Likewise, items of commercial commodities may be added to one another.
The amount of Zakah due on gold and silver ornaments is 2.5%.

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Zakah on securities
Legal judgment concerning dealing in securities:
A security represents a part of a loan owed by the company or the body that gives this security. A fixed interest, which is not affected by the company's profits or losses, is to be offered on this security. However the company is obliged to repay the loan at a determined time. A security has a nominal value, that is the original value, and a market value, which is determined by demand and supply.
Dealing in securities is prohibited as it brings about a usurious interest. Likewise, disposing of securities by selling or buying is regarded as selling the debt to other than the debtor, which is not lawful.
How to pay Zakah on securities?
Though dealing in securities is not lawful, Zakah is due on their par value, which is to be added to other kinds of property, after reaching the Nisab and the lapse of a full year. The payable amount of Zakah is a quarter of the tithe. All usurious interests gained from securities are to be spent in charitable purposes, in a way to assist the common good except in building mosques and printing copies of the Holy Qur'an. However, this spending will be regarded a means to get rid of the ill-gotten gain, but not a Zakah. One is not allowed to spend thereof on himself or on his household. It is recommended that the owner should dedicate it to those afflicted by famines, strains, disasters and the like.

موضوع: Zakah on shares الأربعاء نوفمبر 16, 2011 12:21 am

Zakah on shares:
Legal judgment concerning dealing in shares:
A share indicates any of the equal interests or rights into which the entire capital stock of a corporation is divided. Holding shares is regularly evidenced by one or more certificates. It is liable to gain or loss. A shareholder is free to sell his shares whenever he likes.
A share has a par value, determined when first issued, and a market value determined on the basis of supply and demand in the banknote markets in which the shares are circulated.
Holding shares in a joint-stock company is judged on the basis of the kind of company activities. Thus, sharing in a company that has usurious dealings or produces prohibited commodities such as alcoholic drinks is unlawful. Likewise, sharing in a company that applies certain prohibited kinds of transactions such as usurious on credit sale or aleatory transactions is also unlawful.
How to pay Zakah on shares?
In case the company pays Zakah on its shares, the shareholder is not obliged to pay Zakah on his shares to avoid twice giving Zakah.
Otherwise, a shareholder will be obliged to pay Zakah on his shares as follows: In case the shareholder exploits his shares in trade, the amount of Zakah due on his shares would be 2.5%, according to the market value at the time Zakah becomes due. However, if shares are invested to obtain annual revenues, Zakah is paid in the following way:
a) If the shareholder managed to examine the accounts of the company and know the amount of Zakah due on his shares, he would have to pay a quarter of the tithe (2.5%) as Zakah on this basis.
b) If he does not have knowledge of the company accounts, he may simply add the share revenues to the total sum of his property counted for Zakah and pay a rate of 2.5% as Zakah after the lapse of a full year since the wealth has reached the allotted Nis

ab.

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We will complete the subject inhaa allah