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Zakaah on involuntary pension

Fatwaa ID: 910

Assalamwaleykum esteem alums and muftis , I ask you all to pray for me and my family . My question is in reference to the pension that is deducted from our paychecks and then the employer matches this amount . This funds are invested in a diversified portfolio of various percentage such as infrastructure, real estate, hedge funds, cash , bonds, equities, bond and debts. Do we have to take out zakaat out of this money too? Since we know that this funds are invested in different interest and non interest based investments so how do we know what amount to take out for zakaat purposes if any ? Plus once we retire InshaAllah how do we differentiate what money needs to be taken out that is interest based in order to make my pension funds halaal. JazakAllah Khair to all muftis for baring my ignorance and question .

It’s involuntary taken out directly from the pay check and it’s a pension pool funds that’s management and invested in a diversified portfolio for which I have no say . Please advise accordingly JazakAllah Khair

In the Name of Allaah, the Most Gracious, the Most Merciful.
As-salaamu ‘alaykum wa-rahmatullaahi wa-barakaatuh.

We take note of the details of your query. We understand that the pension is involuntary and you do have a choice in its investment and management. Accordingly,

  1. There is no annual zakaah on the pension until you receive it.
  2. Once you retire, you may accept the full amount. It will be regarded as a gift from the employer. You do not have to give away anything or purify anything.

The ruling would differ if this was voluntary.

And Allaah Ta’aala knows best.
Mufti Muajul I. Chowdhury
Darul Iftaa New York

09/01/1444 AH – 03/23/2023 CE | AMG1-2922

وصل اللهم وسلم وبارك على سيدنا محمد وعلى ءاله وصحبه أجمعين


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