One who has wealth upon which a year has passed and who has a debt; is zakah obligatory upon him?

The questioner : The non-due debt at the completion of the nisab: is this non-due debt deducted from the nisab?

The Shaykh : I mean, you lent me a thousand dinars, for example?

The questioner : No, my lord, the opposite. I mean, for example, I calculate my zakah at the beginning of the Hijri year... I calculate what I have, but on this date, I have, for example, a thousand dinars, but I am in debt by seven thousand dinars.

The Shaykh : It is the issue that was mentioned today... by Al-Khatib.

The questioner : The seven thousand dinars, part of them is due. How, for example? The seven thousand dinars... I owe two thousand or three thousand dinars, but they have been installmentized for me. This is the situation: if they are installmentized for me, I pay one hundred and fifty dinars every month; meaning I sit for three years until I settle them. So they are not currently due, even though... but they have been installmentized for me. The other situation, or the other consideration, is that these three thousand dinars which I am currently installmentizing are due from previous years as a tax... and the third situation is that this debt is on a delay; meaning, how do I take tiles from a group of my friends for the bathrooms, they did not say to me "pay," but the group is leaving me alone, but the reality of the matter... So, do I deduct from the nisab all this debt that is upon me, or not?

The Shaykh : The same question came recently from our brother, Muhammad Al-Khatib, and we were returning from the Fajr prayer. In truth, the question had precision, so I answered as follows: I gave him an example; I am in debt to Zayd, one of the people, by a thousand, and this is my neighbor, I am in debt to him by a thousand. So, if I am intending to pay the debt that is upon me, then it does not come out of me.

The questioner : Zakah.

The Shaykh : But if I am not intending to pay, then zakah comes out of me.

The questioner : And Allah knows best the secrets of the heart.

The Shaykh : So, you apply this to yourself.

The questioner : Do you have the intention to pay during the year, or regardless?

The Shaykh : No, I mean during the completion of the year, of course, the completion of the year; if the year has passed, it is obligatory upon me to pay the zakah, right, or not?

The questioner : No, that is not my question.

The Shaykh : Allow me, no, now I am speaking of the picture we discussed. If the year has passed, it is obligatory upon me to pay the zakah. This hundred dinars that I am in debt to so-and-so, and as we say, and you have heard this from me more than once: this debt is alive, not dead. So, this debt that I have with so-and-so, I want to pay the zakah on it; right?

The questioner : If it is alive?

The Shaykh : I am saying, okay; then I am in debt to you by a thousand dinars. So, if I am intending to pay it to you, then this does not come out of me as zakah.

The questioner : It cancels out what you want to zakat.

The Shaykh : Yes, yes, indeed... but if the matter is the opposite of that.

The questioner : ... .

The Shaykh : Ah, okay, go ahead.

The questioner : ... The debt that is on a delay, I do not want to pay it within a year, I might pay it within a year...

The Shaykh : So, you do not want to pay it, meaning? You do not want to pay it, at least in this year; right?

The questioner : I do not know, if...

The Shaykh : How do you not know?

The questioner : ... I am now, for example, how? Let me give you a real example. I have a debt of eight thousand and five hundred dinars, and this is true. On the nisab, look with me at the money; all I have is four, five, six hundred dinars... and... a debt of about a thousand dinars. In this simple equation, I am in debt for a hundred years; meaning I do not have the means to settle them.

The Shaykh : Excuse me, but you cannot settle anything?

The questioner : I am settling; whenever something becomes available to me, I am settling.

The Shaykh : Excuse me, in your question, you have four hundred dinars, for example, right?

The questioner: Yes.

The Shaykh : Okay; has a year passed upon these four hundred dinars?

The questioner: No.

The Shaykh : So, if we assume a year has passed upon them, and you did not pay its zakah, nor did you pay the debt or part of the debt that is upon you.

Another questioner : I know, we exerted our effort in ijtihad, in truth. We said, since the year does not pass upon any specific amount by itself, what did we decide? We said, on a specific day, what money do you have that represents the accumulation of this year, the accumulation of the year; because if you want to take the amount of these four hundred, they are not the same ones that remain from the beginning of the year to the end of the year; we received and spent and they went...

The Shaykh : We, the issue has no relation to the picture you are describing. Suppose a person is neither a creditor nor a debtor, and he has a nisab that decreases and increases. As long as the year has not passed upon this amount of the nisab, there is no zakah upon him, right, or not? Okay; let us return to your picture; you have this nisab, a year has passed upon it, even though you have what? A liability and you have debts. So, why did you not pay?

The questioner : Did I pay all my debts?

The Shaykh : Yes, because you did not pay the debtors, the money that you have must have its zakah paid; because this is called a treasure.

The questioner : I mean, the amount upon which the year passes means that this specific amount remains for three hundred and twelve months... In the nature of our living and our work, there is no amount of six hundred or a thousand dinars that remains from the beginning of the year to the end.

The Shaykh : I answered you on this, my brother. I told you: separate this picture from the issue of creditor and debtor, right, or not?

The questioner: Yes.

The Shaykh : Which is easier, the complex picture you are presenting, or the picture I am currently dealing with? Suppose that you or I am neither a creditor nor a debtor. I have this nisab. This nisab, during the years, did not remain as it was, but it decreased and increased and decreased and increased. This has no zakah upon it.

The questioner : It has no zakah upon it.

The Shaykh : Allow me a moment. This has no zakah upon it because what has not passed upon it? The year. Okay; is this clear?

The questioner : It is clear to me.

The Shaykh : Okay; so it is even more so in the picture you are asking about. But I assumed that this nisab remained with you and a year passed upon it, so the previous question came from me: since you are in debt to people, why did you not pay? Because you did not pay, and the year passed upon this money, it is obligatory that you pay the zakah. Is this clear?

The questioner : Is that clear?

Another questioner : What did I say? I said: we, only from the perspective of... we said, everyone is doing this, that we said, on a specific day, since the money comes and goes, we consider it... If Allah - Glorified and Exalted is He - provides under our hands an amount that reaches the nisab, regardless of whether a year has passed or not, we consider it for zakah.

Another questioner : ... .

The questioner : Excuse me, excuse me, but what is happening with us, you are not just the amount in your hand. You have a share in such-and-such company. Such-and-such company has cash and it has goods and it has such-and-such. Do you want to calculate what your share is in such-and-such company? How much of it is cash, how much of it is goods? You add it to the nisab.

Another questioner : ... In our case, it is not applicable because there is none, there is none except a share, if we considered it as trade goods.

The Shaykh : Do you have a living debt that you have with people?

Another questioner : There is none.

The questioner : We have a dead debt of two hundred and fifty... No, but as for companies, we do not have any, praise be to Allah, there is only one company.

The Shaykh : So, Abu Muhammad's words are not applicable to you, but his words are applicable. Let us return to Adnan, our picture, my brother. Our picture is that I do not have money, I do not have a nisab, but I have with this person a nisab, and he wants from me a nisab. So, since the picture, as we mentioned earlier, is that if I had a nisab, I would have paid the zakah, then I am not obligated in this picture. But here, the picture is that he has money, he has cash, meaning liquidity. Except that the disagreement remains: has a year passed upon it or not? If it has not passed, there is no zakah upon it.

The questioner : Okay; the debt?

The Shaykh : The debt, if it is alive, has zakah upon it. Whether here, now, I am a creditor; this comes out of me as zakah. But I do not want from me the same debt, and I am not in a state of difficulty in paying it, do you see? But if I were in a state of difficulty in paying it, it would come out of me...

Another questioner : What does it mean, even if I am in debt in the second year and I have a thousand dinars in cash and a year has passed upon them, I pay on the thousand dinars; even though I am in debt because I did not settle this debt.

The questioner : Or close the alif.

The Shaykh : This is it, how?

The questioner : Or close the alif.

The Shaykh : Or what?

The questioner : Close the alif.

Another questioner : Close what is upon you.

The Shaykh : This is it; the point of the fatwa is to help the debtor clear his conscience, otherwise zakah will attach to him, as mentioned in a hadith I will remind you of, following the method of killing two birds with one stone. It is a weak hadith. The first bird, the second bird is related to our research, , do you understand how? Trade, put this money to work, no...