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*ZAKAT ON SHARES AND STOCKS*
Praise be to Allaah.
With regard to zakaah on shares, there are some sorts of shares on which zakaah is due, and others on which no zakaah is due.
A inventory is a written doc stating the quantity of a mortgage given by the bearer on a specified date in return for specified curiosity.
A share is a associate’s portion of the capital of a company.
From these definitions we will see the distinction between shares and shares.
The distinction between shares and shares:
1 – A share represents a stake in an organization, that means that the shareholder is a associate, whereas a inventory represents a debt owed by the corporate, that means that the stockholder is a lender.
Based on this, the shareholder solely earns earnings when the corporate makes a revenue, whereas the stockholder earns assured annual curiosity whether or not the corporate makes a revenue or not.
Also primarily based on this, if the corporate makes a loss, the shareholder has to bear some a part of the loss, relying on the quantity of shares he has, as a result of he’s a associate and proprietor of a part of the corporate, so he should bear some a part of the loss.
The stockholder, alternatively, doesn’t bear any of the corporate’s losses as a result of he isn’t a associate within the firm, quite he’s merely a lender, who lends cash in return for advantages agreed upon whether or not the corporate makes a revenue or makes losses.
Ruling on dealing in shares:
Dealing in shares is haraam in line with sharee’ah, as a result of it’s a mortgage in return for agreed-upon curiosity, and that is riba (usury) which Allaah has forbidden and warned towards, as He says (interpretation of the that means):
“O you who believe! Fear Allaah and give up what remains (due to you) from Ribaa (from now onward) if you are (really) believers.
And if you do not do it, then take a notice of war from Allaah and His Messenger but if you repent, you shall have your capital sums. Deal not unjustly (by asking more than your capital sums), and you shall not be dealt with unjustly (by receiving less than your capital sums)”
The Messenger (peace and blessings of Allaah be upon him) cursed the one who consumes riba, the one who pays it, the one who writes it down and the 2 who witness it, and he mentioned: they’re all the identical. Narrated by Muslim, 2995.
In the second convention of the Islamic Bank in Kuwait 1403 AH/1982 CE it was acknowledged: That which is named curiosity within the terminology of western economists and people who observe them is the essence of riba that’s forbidden in line with sharee’ah. End quote.
Majallat al-Majma’ al-Fiqhi, 4/1/732
Zakaah on shares
Although it’s haraam to deal in shares, zakaah is due on them as a result of they signify a debt owed to their proprietor, and money owed that one hopes will probably be repaid are topic to zakaah in line with the vast majority of students. So its zakaah have to be labored out yearly, but it surely wants not be paid till one takes possession of the worth of the inventory. As for the curiosity that’s taken in return for the inventory, that is unclean and haraam wealth that have to be disposed of by donating it to charitable causes.
The price of zakaah which have to be paid is 2.5 per cent.
We search refuge with Allah from persecution by the hands of the depraved.