Darul Ifta Ibn Masood

Subscribing to a living annuity

· 27 Jumada II 1445 AH1 min readEnglish

Question

1. Is a living annuity permissible for me to take out upon retirement.

2. If I have a voluntary Retirement annuity, I don’t have access to the money until Retirement. Do I pay Zakaat on this?

3. If I take out an investment, my money is with the investment company. How do I pay Zakaat on this?

Answer

1. Life insurance as well as all other types of voluntary insurance are prohibited in Shariah as they comprise of the elements of gambling and interest, both of which have been prohibited in the Quraan and Ahadith. Hence, it will not be permissible to voluntarily subscribe to a life annuity policy at any stage.

2. The capital invested in the life annuity fund will be Zakaatable. The excess (over and above the principal investment) is Riba and will have to be disposed in charity to recipients of Zakaat without any intention of reward.

3. If a person invested in a business venture or in goods of merchandise then Zakaat is payable on the market value of the goods on one’s Zakaat date. However, if one has invested in property (from which he derives income) then Zakaat is only payable on the rental income derived from it if it is available when calculating his yearly Zakaat. If the funds were spent before the due date of Zakaat then the income derived will be exempted from Zakaat.

References (Arabic / Urdu sources)

والسبيل في المعاصي ردها وذلك هاهنا برد المأخوذ إن تمكن من رده بأن عرف صاحبه وبالتصدق به إن لم يعرفه ليصل إليه نفع ماله إن كان لا يصل إليه عين ماله أما إذا لم يكن الأخذ على شرط لم يكن الأخذ معصية والدفع حصل من المالك برضاه فيكون له ويكون حلالا له…الفتاوى الهندية ٣٤٩/٥

وقال في النهاية: قال بعض مشايخنا: كسب المغنية كالمغصوب لم يحل أخذه، وعلى هذا قالوا لو مات الرجل وكسبه من بيع الباذق أو الظلم أو أخذ الرشوة يتورع الورثة، ولا يأخذون منه شيئا وهو أولى بهم ويردونها على أربابها إن عرفوهم، وإلا تصدقوا بها لأن سبيل الكسب الخبيث التصدق إذا تعذر الرد على صاحبه اهـ…رد المحتار ٦/٣٨٥

وسمي القمار قمارا لأن كل واحد من المقامرين ممن يجوز أن يذهب ماله إلى صاحبه، ويجوز أن يستفيد مال صاحبه وهو حرام بالنص، ولا كذلك إذا شرط من جانب واحد لأن الزيادة والنقصان لا تمكن فيهما بل في أحدهما تمكن الزيادة، وفي الآخر الانتقاص فقط فلا تكون مقامرة لأنها مفاعلة منه زيلعي…رد المحتار ٦/٤٠٣

Answered by
Maulana Ebrahim Ahmed
Checked & approved by
Mufti Mohammed Desai Saheb
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Source: Darul Ifta Ibn Masood — https://fataawa.co.za/subscribing-to-a-living-annuity/
Fatawa SA: https://fatawa.co.za/fatwa/ibnmasood-29347

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