I am govt. servent.please clarify that 1)interest given on GPF is valid or not? If yes how? 2) can I transfer interest money to Income Tax? please explain in the light of fatwa. wassalam
Answer
(1) If the government deducts an amount from salary without the permission of employee and adds a similar amount to it and deposits it into the bank and gives it back with interest to the employee after his retirement in lump sum, then it is reward and gift from the government. The definition of interest does not apply to it; hence the use of this amount is lawful. Yes, if some amount is deducted with the permission of employee, then the use of the interest earned on this amount will be unlawful.
(2) You can give, it is allowed.
Allah (Subhana Wa Ta’ala) knows Best
Darul Ifta,
Darul Uloom Deoband