📚 Source: Ahkam wa Masail, Zakat ke Masail, Volume 1, Page 270
❖ Two Important Questions & Their Answers Related to Loan and Zakat
❓ Question ①
A person has lent ten thousand rupees to someone, and it is expected that the amount will be returned after two to three years. Is it obligatory for the lender to pay zakat on this amount every year, or is it the responsibility of the borrower to pay zakat on it?
❓ Question ②
A person is in debt of twenty thousand rupees, while he possesses gold worth fifteen thousand rupees. Can he pay off his debt using the zakat amount from this gold? Moreover, since he is a debtor, is zakat obligatory upon him or not? Kindly explain.
✦ Answer
الحمد لله، والصلاة والسلام علىٰ رسول الله، أما بعد!
① Relationship Between Loan and Zakat
◈ It is obligatory upon the lender to pay zakat on the amount given as a loan;
◈ The borrower is not responsible for paying zakat on the loaned amount.
✔ If the lender stipulates at the time of lending that the borrower will pay zakat on the loaned amount, such a condition is impermissible in Shari‘ah.
✔ If the borrower, despite this unlawful condition, pays zakat on the borrowed amount, then:
➤ It will be considered a form of interest (riba),
➤ Or, it may be counted as zakat on behalf of the lender.
② Debtor and Zakat
◈ In the given scenario, the debtor cannot use the zakat portion of his gold to repay his debt, because:
➤ Shari‘ah does not permit a zakat giver to spend zakat on himself.
◈ However:
➤ Despite being in debt, since he possesses wealth equal to the nisab (i.e., gold worth fifteen thousand rupees), zakat is obligatory upon him.
➤ After paying zakat, he may use the remaining wealth to fulfill his needs.
➤ Repayment of debt is included among those needs.
ھذا ما عندي، والله أعلم بالصواب
This is what I know, and Allah Almighty knows best what is correct.
