The Ruling on the Employees' Association and the Ruling on the Zakah of Its Funds

Question:
Honorable Shaykh, a group of us are partners in what is called the Employees' Association, where each person pays a specific share at the end of every month equally, and it is given to one of them. Is zakah due on this amount?

Answer:
First, I do not approve of this association because it is among the stipulated loans, meaning a loan that brings benefit to itself. It also falls under two sales in one sale, and the Prophet (peace and blessings be upon him) forbade two sales in one sale. Every loan that brings benefit or suspicion is [forbidden], and this loan brings benefit to its owner. It is also a case of a contract within a contract: lending to you on the condition that you lend to him. This is the ruling. So I see that this association is not permissible. If a person needs a loan, he should borrow a good loan from one of his brothers and repay him. If he needs it, he should borrow a good loan from one of his brothers. If he does not find someone to repay him, there is the issue of tawarruq (a commodity sale used to obtain cash), where he buys a commodity at a deferred price and then sells it at a spot price. However, he does not sell it to the one he borrowed from, but to someone else, and he benefits from the spot price. When the term comes due, he pays the owner of the commodity. This is if he does not find someone to lend to him. This is what I see. As for when they collect these funds and a year passes over them, zakah is due on them, because it is not like every camel. Each person pays zakah according to his share, each pays zakah according to what he paid in, according to what he paid into it. Yes.