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What is the Islamic legal ruling concerning funds forcibly deducted and those added by the company to a savings fund, especially given the lack of knowledge regarding the sources of investment for the profits? And is Zakat obligatory on these funds, given that they are not in the employee's possession?

1 min readAlso available in العربية

It is permissible to subscribe to savings funds if they adhere to Islamic guidelines, meaning their money is not invested in prohibited ventures. If the investment is in unlawful areas and subscription is voluntary, then it is not permissible. However, if it is compulsory, the subscriber should dispose of the prohibited interest by spending it on general Muslim welfare.

Regarding Zakat: If the money is invested in prohibited ventures, the principal amount is subject to Zakat annually if it reaches the nisab. As for the profits, they should be spent on general Muslim welfare. If the money is invested in permissible ventures, both the principal and the profit are subject to Zakat annually if they reach the nisab. It is not necessary to pay Zakat from the exact money held within the fund itself.

Summarized from the full answer at Ftawy · reviewed Sep 2, 2026

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