Assalamalaikum Ulema Karam, Subject : Recovery of already paid income taxes through future generated interest money. I’m a computer engineer working with a software company in Mumbai. Every year I’m required to pay income taxes to the Government of India from the salary which we earn through our hard work. This money which goes into the payment of taxes is quite substantial. As part of tax savings we do some investments like fixed deposit etc. Over a period of time I get some interest money on my fixed deposit amount. My question here is, would it be right if I use the interest money generated over my fixed deposit money to recover my loss in the form of tax payment. I’ll give a scenario to better explain my thoughts: Suppose till the December 2009, I had paid taxes of Rs. 50000/- in total. Now at the start of January 2010, my bank gives me an interest of 30000/- on my fixed deposit money. Can I use this money on myself, with niyat that I’m recovering my 30000/- amount of total 50000/- paid in form of taxes. Would it be jayaz for me. Request you all to please kindly clarify. Jazakallah, Allah Hafiz. Duwa ki darkhwast hai.
Answer:
(Fatwa: 125/124/B=1432)
In the said question, as much amount you have paid in income tax that much you can take from the interest money. It is allowable. However, it is better that first you should get the interest amount and then pay it in income tax.
Allah (Subhana Wa Ta’ala) knows Best
Darul Ifta,
Darul Uloom Deoband