Some other Issues of
i. What has so far been discussed deals with
the particular issue of the property being illicit (haraam).
Should the property in his possession now, which may still
belong to others, end up with him through lawful means and
sustained damage or loss, the ruling is different, in some
aspects, from that which has been discussed so far. It goes
without saying that when the original proprietor is known, the
property has to be returned to him in kind; if not, a similar
one or price thereof should be reimburse. Should the property
not be known in some detail. The ruling which should apply is
that of property anonymous which has been acquired through
ii. What has been termed as "raddil
madhaalim" – making amends – falls within the topics already
discussed. "Making amends" is generic title for something done
to repair or pay for some harm, unkindness, damage, etc.
although it may entail financial reparations or damages to
others, yet it has become a vehicle, in some cases, to
compensating other parties without latter being harmed; Thus,
ruling may be passed that makes it incumbent on the mukallaf
to pay damaged or return the property to its "owners" or their
heir in their absence.
However, the mukallaf should take the
following as regards "raddil madhaalim" into account:
Any property, which belongs to other parities
and having passed into the hands of the mukallaf, has to
be returned to its rightful owners, who are not known, by way of
charity on their behalf. This though concerns the property that
passes into the hands of the mukallaf through lawful as
well as unlawful means, without the latter being mixed up with
his halal property. The return of property should be done
in kind, or the value thereof, if it was disposed of. This
procedure however has to be sanctioned by the Marji',
regardless of whether the quantity of property was known or not
That said, it must be stressed that taking
action as to this matter is not confined to those who passed
away or on the brink of death, as is commonly held by those
leaving a will at the time of throws of death. Rather, it is an
obligation that has to be attended to by the mukallaf as
soon as he becomes aware of it, repent for committing the
misdeed in the first instance, and being able to make
reparations. Furthermore, it is mustahab as a matter of
ihtiyat to absolve oneself of the responsibility, in the
event of doubt, whenever he wished.
iii. The term "majhul il malik" –
property whose owner is unknown – also falls under the banner of
this section. This concerns any case where the original
proprietor cannot be identified or reached in any way.
It is noteworthy that whether the owner is an
individual, a group of people, a quarter, such as the Marji'
or a trust administrating a waqf, and the state, even if
it is tyrannical or non-Muslim. The state's property is dubbed
as "owner anonymous"; this view is at variance with some
2. That which is left
over and above one's annual expenditure
This is the most important topic of Khums,
for the mere reason that many people are tested with it and for
the huge ramifications of the subjects. The 20% Khums tax
should be levied on the surplus of one's gains during the fiscal
year. That is, after deducting all expenses on one's living,
what is spent on production (and overheads), paying back debt,
that which is spent by way of any act of worship, such as
hajj, Zakat, and kaffarah, and other from of
Rules Pertaining of
Khums and its Avenues
1. Gains are any lawful source of income to
the mukallaf. However Khums is not due on each and
every sort of gain. The Lawgiver has made some distinctions as
to which of these gains should be subjected of Khums tax
and which is not.
What is obligatory on the mukallaf to
pay Khums on is the net surplus of income from trade,
industry, agriculture and business, and acquisitioning anything
lawful. Whatever is passed into his hands, such as presents,
inheritance, returns from waqf, what the poor receives of
the share of sadaat (descendants of the Prophet (a.s. )
), khums, sadaqah, and raddil madhaalim. As for
the "share of the Imam', once it is received by the eligible
person by virtue of being poor, turning into a self-sufficient
one, he is not required to pay Khums on it, should there
be a leftover of the Khums amount.
Should the said share be received under any
other title, other than poverty, such as the share given the
theology students, those involved in the propagation of Islam,
the mujahideen, etc, it will be considered part of his
property, in which case Khums has to be paid on it.
Things, which do not
i. Inheritance money passed into the hand of
the inheritor after the testator's death. This does not cover
that which is wrongly held by the generality as inheritance,
i.e. what the father gives away, in his lifetime, to his
offspring as gift, and what provisions he makes in his will for
them of his own share, of one third.
However, inherited property is that which
passes into the hands of the inheritor, after the death of the
testator, of what the deceased left behind, of his property in
his lifetime, to be distributed in accordance with the
ordinances of shari'a law. That is of course, barring any
liability, in the bequeathed property, of Khums, in which
case the inheritors are responsible for getting the estate
Khums taxed before any distribution is made, just to absolve
the deceased of the responsibility for Khums liability.
If the inheritors get any property as a
result of the death of the testator, without the deceased being
the owner of it in his lifetime, such as the compensation paid
by his employer or what indemnity he is entitled to for getting
martyred, insurance money, blood money… etc. it will not be
treated as inheritance exempt from Khums, even if such
property is distributed on the same lines of inheritance money.
ii. The dowry, given in marriage, to a woman.
So does the compensation paid to the husband by his wife as a
price for divorcing her irrevocably.
iii. That which should be Khums taxed
immediately, i.e. of minerals and treasure trove. Should the
mukallaf pay Khums on such property and amass it to
his capital assets, yielding returns and without spending it on
his provisions, he is not required to pay Khums on it
again, despite the fact that it has become surplus to one's
93. So long as capital assets are considered
among gains, any returns they yield are treated likewise with
regard to the payment of Khums. Any profits that may
attract Khums must be treated in the same way, i.e.
without difference between that which is earned seasonally, such
as livestock offspring, its mild and woo, the fruit of a tree…
etc. and that which is uninterrupted, such as the growing of a
tree from a shrub, an under nourished sheep that gets fat, etc.
This rule is one for all types or property,
i.e. that which has already been Khums taxed or it may
have become due – but not yet collected – the property which has
no Khums liability, such as that of inheritance source,
and whether it was possessed with the intention of keeping or
trading in it. The reason being that any new increase is deemed
new profit that is independent of its origin. Thus, Khums
has to be paid on it in the same way as other profits, provided
that all requirements are fulfilled. You may also consult para.
(119) in this regard.
Should the increase come about as a result of
the fluctuation in price, which in turn emanates from the
economic activity, the ruling may take three different facets:
a. The capital asset, whose value has risen,
should have been acquired in the first instance to trade in,
which is of two kinds:
a/1. The capital asset, which has been
intended as an investment, may remain constant over the years,
such as dairy cows, chicken eggs, and transport cars… etc. In
such a case any appreciation in the market value of the capital
asset should not be subject to Khums, as long as it remains
in his possession. Should he sell it, any extra amount over and
above its price would be deemed as gains in the year it was
sold. If the excess amount is spent during that year, he
should be exempt from paying Khums on it; and if it
remains till the end of the fiscal year, Khums must be
paid on it.
a/2. The same applies to the capital
expenditure (in any business), such as showrooms, equipment and
machinery of production, premium paid for the property, etc.
a/3. In some other instances, the capital
asset in itself is intended to be traded in and make a living as
a result, such as buying and selling real property, livestock,
vehicles… etc. In this case, any profit made in the process,
i.e. over and above the market price, is deemed profit; thus, it
should be Khums taxed, even if it is not sold.
b. The item could have been acquired for the
purpose of personal benefit. No tax should be levied on any
extra amount of appreciation, over and above what the
mukallaf has paid for the item, unless he sells it. For
example, a person bought a property to live in. having sold it
and made a profit of, say, thirty thousand dollars on the buying
price, he must pay Khums on the profit he made in the
process. That is, when his tax year comes to an end, and
provided that the profit is still surplus to his requirements.
c. The property should not be liable for
Khums to start with, such as that which passes into the
hands of the mukallaf by way of inheritance. Should it
appreciate in price since the owner first acquired it, and he
sells it, or decides to trade in it for that matter, no Khums
is due on the profit he could have made.
The same ruling applies to any property
passing into the hands of the mukallaf by way of gift of
without paying for it, provided it does not carry a Khums
liability at the outset. For example, the item could have been
used the moment it has passed into the mukallaf's hands,
or Khums has become due on it and was paid. Since payment
of money has been made which render the item as though it was
bought, no Khums should be paid on the excess amount on
the original value, even if the owner decides to trade in it.
There may be another scenario. Suppose that
Khums has become due on a derelict land, which the
mukallaf developed, yet he did not utilize it in any way,
until one year has passed. When he paid Khums on it, he
paid it in money; in such a case, he is not required to pay
Khums on any extra money made as a result of the property
appreciating, in a measure equivalent to four fifths of the
value. As for the remaining one fifth of the property, he should
pay Khums on the extra amount of appreciation.
94. There is no difference in whether the
item getting appreciated being any kind of property, i.e.
currency or otherwise. For example, should you exchange your
lira or dinar for a US dollar or German mark, only to appreciate
within the fiscal year, this increase deemed profit, in which
case it is liable for payment of Khums. It will be
governed by the rules so far discussed and those that will be.
That is, irrespective of whether it was intended for acquisition
or trading and making up for any loss.
For example, a person exchanged one thousand
units of an (x) currency, which is net of Khums, into one
thousand US dollars. Having acquired the new money, they set
about their expenditure and trading in this money. The value of
(x) depreciated, so much so that the rate of exchange, at the
end of the fiscal year, has reached 2 (x) for every dollar. The
mukallaf in this example must pay Khums on the second one
thousand (x), regardless of the fact that they are not dealing
with it now.
It will be considered part or the one thousand
dollars, if they were speculating with currency. Should the
exchange of money be intended to retain the value, no Khums
should be paid. That is, irrespective of whether it was spent on
one's living expenses or on assets bought with a view to making
profit, or using in the means of production, such as equipment,