How do we canculate Zakaat on the Al-Mabroor vehicle finance as an investor?

In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh

The Darul Iftaa devised and certified the Al-Mabroor Vehicle Investment Scheme. Investors purchase vehicles and lease them to customers for a fixed tenure of 60 months for example. The vehicles are gifted to the customers upon maturity and successful payment of rental instalments.

In principle, the investment assets are not considered as stock in trade since they are not purchased with the intention of re-sale. Rather they are purchased with the intention of leasing them to potential customers and receiving the dividends thereof. Therefore, Zakaat is only due on the dividends accrued to the investors and not the actual investment assets (vehicles). The dividends will be considered as cash on hand and Zakaat should be calculated according to one’s personal financial situation.[1]

And Allah Ta’āla Knows Best

Ismail Desai,

Darul Iftaa

Checked and Approved,

Mufti Ebrahim Desai.