Is zakat due on the full principal of a debt held by another party, from whom it was forcibly prevented from being collected despite demands for payment?
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Fatwa number ( 20476 )
Q: The one who prays for your health and well-being and loves you for the sake of Allah manages an industrial company that manufactures and supplies its pharmaceutical and medical supply products to a number of clients in both the public and private sectors. The company’s overdue debts for the years (13, 14, 15, 1416 AH) have reached several hundred million riyals. The company has made great efforts in demanding and following up on the collection of these debts, taking all possible measures and necessary procedures toward that end. A long period has passed since these debts were incurred, and their collection has become difficult, which has affected the company’s ability to possess its funds and thereby dispose of them or benefit from them in achieving its interests on a continuous basis, in accordance with the opportunities that arise for it. In light of its concern for purifying the full nisab of its shareholders’ funds, the company presents to your Eminence the matter of purifying its overdue debts, which it has become unable to collect from others, seeking your guidance on the extent to which they meet the conditions of complete ownership, growth, and the completion of a lunar year, and how their zakat should be calculated in the event that some or all of them are collected: Is zakat due on the full principal of a debt held by another party, from whom it was forcibly prevented from being collected despite demands for payment?
Is zakat due only on the portion of the debt that is collected, after a lunar year has passed over it? We seek your Eminence’s guidance on the matter of purifying such debts, with the knowledge Allah has granted you and your understanding of the legacy of the righteous predecessors, and what the Imams adopted based on what is reported from the majority of scholars.
A: If the debt is owed by an insolvent person, or by a solvent person who is delaying payment, and the creditor cannot extract his debt from him, then zakat is not obligatory on the creditor until he receives his debt and a lunar year passes over it. However, if the debtor is solvent and the debt can be extracted from him, then zakat is obligatory on the creditor whenever the lunar year completes, provided the debt reaches the nisab by itself or by combining it with other currencies or similar items in the possession of the debt owner. And success is from Allah, and may Allah send prayers and blessings upon our Prophet Muhammad, his family, and his Companions.
Q: The one who prays for your health and well-being and loves you for the sake of Allah manages an industrial company that manufactures and supplies its pharmaceutical and medical supply products to a number of clients in both the public and private sectors. The company’s overdue debts for the years (13, 14, 15, 1416 AH) have reached several hundred million riyals. The company has made great efforts in demanding and following up on the collection of these debts, taking all possible measures and necessary procedures toward that end. A long period has passed since these debts were incurred, and their collection has become difficult, which has affected the company’s ability to possess its funds and thereby dispose of them or benefit from them in achieving its interests on a continuous basis, in accordance with the opportunities that arise for it. In light of its concern for purifying the full nisab of its shareholders’ funds, the company presents to your Eminence the matter of purifying its overdue debts, which it has become unable to collect from others, seeking your guidance on the extent to which they meet the conditions of complete ownership, growth, and the completion of a lunar year, and how their zakat should be calculated in the event that some or all of them are collected: Is zakat due on the full principal of a debt held by another party, from whom it was forcibly prevented from being collected despite demands for payment?
Is zakat due only on the portion of the debt that is collected, after a lunar year has passed over it? We seek your Eminence’s guidance on the matter of purifying such debts, with the knowledge Allah has granted you and your understanding of the legacy of the righteous predecessors, and what the Imams adopted based on what is reported from the majority of scholars.
A: If the debt is owed by an insolvent person, or by a solvent person who is delaying payment, and the creditor cannot extract his debt from him, then zakat is not obligatory on the creditor until he receives his debt and a lunar year passes over it. However, if the debtor is solvent and the debt can be extracted from him, then zakat is obligatory on the creditor whenever the lunar year completes, provided the debt reaches the nisab by itself or by combining it with other currencies or similar items in the possession of the debt owner. And success is from Allah, and may Allah send prayers and blessings upon our Prophet Muhammad, his family, and his Companions.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.