Question:

I make a contribution from my salary into a company share scheme. I do not receive any dividends from these shares at the moment (I have to wait another 4 years before I can benefit, for tax reasons!). The imam from my local masjid said that it was not subject to Zakah, since I had nothing to show for it at the moment.

Can you advise whether Zakah is payable on these shares and how I should calculate it please.

Answer:

Because Shares represent a proportional share in the company one will have to pay for any dividend that has accrued to you as well as that portion of your share(s) that represents the variables of the company such as merchandise, raw material etc. (not fixed assets such as buildings, stores, machinary etc. You can discover these details by requesting the annual report from the company. If this is not possible for some reason then you should give Zakah on the value of the whole share. This is the view of scholars like Shaikh Taqi Usmani.

Mufti Mohammed Sajjad

Wallahu Aalam bis-sawab

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The answer to this question is the opinion of the scholar and does not reflect the opinion of other scholars of As-Suffa Institute and As-Suffa Institute as an organisation.