Khums on “Assets” Fiqh Explanations   www.Islamic-Laws.com Draft

Case A - Asset (say Flat/Real estate ) is from Khums free money ( Mukhammas )This does not include (Meerath / inheritance)

 Two situations based on intention

1.    It is purchased with the intention of renting / keeping. No Khums. But if u later on sell it with a profit then on the profit khums should be given on the date of “ras sanna” ( Khums year) ie date fixed for Khums

It can also be given in one years’ time if separate rassana is maintained for this income (Sistani) & Syed Khoie permits separate Rasaana for each income in any case

2. It is purchased with the intention of sale. -In the next yr if the price increases and you can sell and you didn’t, then one has to pay the khums on the price increase on khums date, even if it was not sold.

The Mukhammas Value then becomes the Value on which the Profit was calculated.

In subsequent years, if the Property value increases more than the value considered on Khums date in the previous year, then Khums has to be paid on such increases .

However if the property value decreases as on the Rassaana date  ( or asset is sold during year at value less than the previous year value) then the reduction in value cannot be adjusted from the income of that year

 

Case B - Asset is from Earnings of the year / Money on which khums has not been paid

If the Asset is purchased with intention of trading /sale then it cannot be considered as ‘expense’

In general assets purchased for one’s own use can be considered as expense of the year with some conditions. like not israf, within one’s status as per Urf,

However Khums becomes applicable on this ‘asset’ if it is not used during upto the Rassanaa date . Or 1 year from the date of the earnings from which asset was purchased ( not asset purchase date) .

Note that purchase of House for own family use has exceptions where the property is built over multiple years

 

 Khums on Benefits associated with Assets

If khums to be paid for an Asset and its owner fails to do that at the required time then khums not only gets associated with the object it self but it extends to all its benefits which can be of three types:
1- Received benefits
2- Intentional/Deliberate missed opportunities or benefits
3- Unintentionally missed benefits

For example, if a person owns a flat which he dedicated to use for commercial use, bought it from non-mukhamas money and time for khums passed, then in addition to the khums on asset ,he needs to pay  khums on all associated benefits immediately as they are received & not wait for khums year to end

1- Received associated benefits: Eg if he is benefiting from rent paid by tenant then he needs to pay khums "20%" of all the rent

If a person is not benefiting directly by rent but he for example having his daughter to live in the flat then he needs to estimate the amount of rent which would be applicable and pay Khums. At the time each rent benefit accrues

2- Intentionally missed benefits: Eg A person may decide to keep flat vacant. In this case he still needs to estimate the rent and pay Khums on it

3- Unintentionally missed benefits: eg if owner could not find a tenant. Scholars fatawa differs in this case but some of scholars like Syed khoiee says that the owner needs to estimate the missed rent and pay khums on it

As per sayid sistani unredeemed benefits are of two categories:

1.    that are considered as being available – by general public (Urf)-  such as the availability of renting the house (Even if the person didn’t intentionally keep the flat empty) Khums is payable

 

2.    That aren’t considered – by general public- as applicable such as the renting of personal books. No Khums is payable

Source – Shaikh Moosa Oman