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Asslamoalykum, Question 1: I took one Unit linked Insurance plan (ULIP) to save tax on my salary. To best of my knowledge, Benefits (money wise) are not sure may go up or down but asal (return of principal invested amount is sure. For initial 3 years I am bound to pay and cannot with draw. After 3 year I am free to with draw my money with some charges, else I can continue for 17 years to get additional benefits. As per my instructions all my money is invested in equity, type of equity not known whether Halal or Haram. My Questions are: Should I pay zakat on such type of Investment /savings if yes ,wheather on whole amount or only on principal Is this kind of transaction ULIP (Unit link Insurance plan) is Halal or not . Question 2: My salary is Rs.1,50,000 per month and at the end of the year my savings are only less than Rs. 20,000/. My maximum savings reached at Rs. 5,00,000/ and due to my sister operation all of the money was spend. Please let me know should I pay Zakat at the end of the year. Also let me know what should be the calculation method for salaried person Should I wait to complete one year for nisab to mature or on reaching nisab I should pay the zakat.

Answered according to Hanafi Fiqh by Darulifta-Deoband.com
Asslamoalykum, Question 1: I took one Unit linked Insurance plan (ULIP) to save tax on my salary. To best of my knowledge, Benefits (money wise) are not sure may go up or down but asal (return of principal invested amount is sure. For initial 3 years I am bound to pay and cannot with draw. After 3 year I am free to with draw my money with some charges, else I can continue for 17 years to get additional benefits. As per my instructions all my money is invested in equity, type of equity not known whether Halal or Haram. My Questions are: Should I pay zakat on such type of Investment /savings if yes ,wheather on whole amount or only on principal Is this kind of transaction ULIP (Unit link Insurance plan) is Halal or not . Question 2: My salary is Rs.1,50,000 per month and at the end of the year my savings are only less than Rs. 20,000/. My maximum savings reached at Rs. 5,00,000/ and due to my sister operation all of the money was spend. Please let me know should I pay Zakat at the end of the year. Also let me know what should be the calculation method for salaried person Should I wait to complete one year for nisab to mature or on reaching nisab I should pay the zakat.

Answer

(Fatwa: 565/370/H=1432)

Note down the Islamic date in which you became sahib-e-nisab. When the year completes and the same date approaches and you possess nisab or extra money, pay its zakah after calculating it’s amount. The money you invested in a business, though the business is operated by you or by someone else or any company is doing the business in your name and there is profit too, you will have to pay zakah on the capital amount that you gave as well as on your share in profit. 

The ULIP system that you have written is not right as per the Shariah. What is equity? What are its terms and conditions? Once you write its detail you shall be guided in this regard, in-sha-Allah. 

No zakah is wajib on the money that is spent during the year in operation, treatment or food. For more detail, see Bahishti Zewar. If you want to know anything more, write it.

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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