Zakah on Shares and Their Profits
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Q5: The company holds a group of shares and stakes in other companies, some of which are local companies subject to zakah according to the regulations of the Kingdom, and some are outside the Kingdom and are not subject to zakah, though they may be subject to taxes. These investments are long-term, meaning that acquiring them is not for the purpose of trading, nor does the company intend to sell them in the foreseeable future. Do the investments within the Kingdom, outside the Kingdom, or both, enter the zakah base, along with their profits, or are only the profits subject to zakah? Regarding the profits, is zakah due immediately upon receipt, or when a full lunar year has passed from the date the profits were received?
A5: Shares are of two types: commercial shares that the owner intends to offer
for sale and purchase. Zakah is obligatory on these and their profit at their market price after the completion of a lunar year. The lunar year for the profit is the same as the lunar year for the principal. The amount of zakah on all of it is one-quarter of a tenth, i.e., 2.5%. And fixed shares that the owner intends to invest in and does not intend to offer on the market for sale. For these, zakah is due on the profit after a lunar year has passed since its acquisition, and there is no zakah on the principal of the share. The amount of zakah is one-quarter of a tenth, i.e., 2.5%.
A5: Shares are of two types: commercial shares that the owner intends to offer
for sale and purchase. Zakah is obligatory on these and their profit at their market price after the completion of a lunar year. The lunar year for the profit is the same as the lunar year for the principal. The amount of zakah on all of it is one-quarter of a tenth, i.e., 2.5%. And fixed shares that the owner intends to invest in and does not intend to offer on the market for sale. For these, zakah is due on the profit after a lunar year has passed since its acquisition, and there is no zakah on the principal of the share. The amount of zakah is one-quarter of a tenth, i.e., 2.5%.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.