Is Zakaat due on a loan?
tariqulislam1
Is zakat due on a loan? If so under what are the conditions to be
fulfilled in terms of time, type of wealth, specific amounts? Ustadh
Abdullah responds to this question from one of our members!
For another interesting article on zakaat, see Mufti Abdur-Rahmaan
ibn Yusuf article at our website:
http://lamppostproductions.org
Question:
Does a person have to pay Zakat on a loan they gave to another
person?
Ustadh Abdullah's response:
If a person lends money to another, and that money equals or exceeds
the zakatable minimum dollar equivalent of 85 grams of gold or 595
grams of silver, he/she is required to pay Zakah on that loan when
the following conditions are fulfilled:
1- that the money lent is received back from the person who took the
loan
2- that the form of wealth received back from the loanee is cash (as
opposed to trade commodities)
3- that the amount received back from the loanee is atleast the
zakatable minimum (nisab) - even if it was reached as the result of
multiple payments, just as he/she would also pay zakat on it if what
he receives completes the nisab of other wealth in his/her
possession
The main issue is that one is not required to pay zakat on a loan
given to another until they have received either full payment of the
loan after a complete lunar year (hawl) has passed or if after a
year from the loan date, the loaner receives enough payments whose
sum are equal to or greater than the nisab - or it completes the
nisab of wealth already in one's possession from other means.
If it happens that the loanee takes a number of years to pay back
the loan, the loaner is only obliged to pay zakah for one year
unless he insisted that the loanee not pay him back until a number
of years later in an attempt to flee from having to pay zakah on
one's loan. In this case, the loaner has to pay zakah on the loan
for each year that has passed.
[Adopted from al-khulasa al-fiqhiyya: Maliki law]
And Allah knows best
Was Salam
Abdullah
Ustadh Abdullah bin Hamid Ali is the first American to attend and
graduate from the University of Al- Qarawiyeen's Faculty of Shariah
The focus of his study was the understanding of the science of Usool
Al-Fiqh and `Aqeedah. He has studied under some of the top scholars
of Islam including Dr Abdullah Ghaazeewee, Professor of Usool Al-
Fiqh, Sheikh Muhammad At-Ta'weel, Muftee, Scholar, and Professor of
Usool Al-Fiqh, Sheikh Muhammad Al-Ghaazee Husainee, Grand Muftee of
Morocco and Professor of Al-Fiqh Al-Muqaaran, Sheikh Ahmad Zweetin,
Professor of Fiqhul-Hadeeth and many others! Please visit us at:
http://lamppostproductions.org for more interesting articles by
Ustadh Abdullah