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Can I pay income tax from interest earned on max GP Fund subscription?

Answered as per Hanafi Fiqh by Darulifta-Deoband.com
Aslamu alai kum I am govt. employee.Can i deposit my monthly provident fund subscription to that much of an amount so that i get maximmum Income tax rebate.I am bound to earn more interest on such deposited amount.Even after getting some rebate on income tax by depositing maximum GP-fund subscription,Still If i have to pay income tax ,Can i pay income tax from interest earned on depositing maximum GP FUND subscription?


(Fatwa: 1623/1623/M=1431)

Do you deposit the money in monthly PF by your choice or is itt deducted automatically from your salary and is deposited in the bank? Both the cases carry different rulings. The first case is of interest while the second is not. However, one is allowed to pay income tax with interest money in compulsion but depositing money in bank with the intention of getting interest and paying income tax with that interest money is disliked. One should avoid depositing money in the bank in order to get interest. One can pay the income tax with the interest of bank because the interest finally reaches the treasury of government (from where it came).

Allah (Subhana Wa Ta’ala) knows Best

Darul Ifta,
Darul Uloom Deoband

This answer was collected from the official ifta website of Darul Uloom Deoband in India.

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