Khums Rulings Seminar

KHUMS: THE ISLAMIC ’TAX’ Shaykh Saleem Bhimji

INTRODUCTION TO SESSION
Shaykh Saleem Bhimji – www.al-mubin.org | www.iph.ca | www.qaim.ca
KHUMS
PERSONAL
BUSINESS

WHAT IS KHUMS/KHUMUS?

KHUMS IN THE QUR’AN
‫وا‬ُ‫م‬
َ
‫ل‬
ْ
‫اع‬َ‫و‬َ‫و‬ َ‫اَم‬َ‫ت‬َ ْ
‫اْل‬َ‫و‬
َ
‫َب‬ْ‫ر‬
ُ
‫ق‬
ْ
‫ال‬ ‫ِي‬ ِ‫ِل‬َ‫و‬ ِ‫ل‬‫و‬ُ‫س‬َّ‫ِلر‬‫ل‬َ‫و‬ ُ‫ه‬ َ‫س‬ُ ُ
‫ُخ‬ ِ
ِّ
ِ‫لِل‬
َّ
‫ن‬
َ
‫أ‬
َ
‫ف‬ ٍ‫ء‬ْ َ
‫َش‬ ْ‫ن‬ِِّ‫م‬ ‫م‬ُ‫ت‬ْ‫ِم‬‫ن‬
َ
‫غ‬ ‫ا‬َ‫م‬
َّ
‫ن‬
َ
‫أ‬ِ‫ِني‬‫ك‬‫ا‬ َ‫س‬َ‫م‬
ْ
‫ال‬
ِ
َّ
‫الِل‬ِ‫ب‬ ْ‫م‬ُ‫نت‬َ‫آم‬ ْ‫م‬ُ‫ـت‬
ْ
‫ن‬
ُ
‫ك‬
ْ
‫ن‬ِ‫إ‬ ِ‫يل‬ِ‫ب‬ َّ‫الس‬ ِ‫ن‬ْ‫اب‬َ‫و‬…
“And you Muslims must all know that whatever you
gain as wealth, a fifth of it (20%) is for Allah and
for the Messenger Muhammad and for the near of
kin and the orphans and the needy and the
wayfarer from the family of the Prophet, if you have
true belief in Allah…” Surah al-Anfal (8), Verse 41

KHUMS IN THE AHADITH
In Wasaa’il al-Shi’a (30 volumes and over
36,000 ahadith), there are over 80 ahadith
divided up into fifteen sections in relation to
the practical rulings of khums.

KHUMS IN THE AHADITH
َ‫ب‬َ‫ت‬
َ
‫ك‬
ُ
‫ض‬
ْ
‫ع‬َ‫ب‬‫ا‬َ‫ن‬ُ‫اب‬َ‫ح‬
ْ
‫ص‬
َ
‫أ‬‫لـى‬ِ‫إ‬ِ‫ب‬
َ
‫أ‬ٍ‫ر‬
َ
‫ف‬
ْ
‫ع‬َ‫ج‬ِ‫ان‬َّ‫اثل‬ِ‫ن‬ْ
ِ‫ِب‬
ْ
‫خ‬
َ
‫أ‬ِ‫ن‬
َ
‫ع‬ِ‫س‬ْ‫م‬ُْ
‫اْل‬
ْ
‫ْع‬
َ
‫أ‬َ‫ِيع‬
َ
‫َج‬‫ا‬َ‫م‬ُ‫يد‬ِ‫ف‬َ‫ت‬ ْ‫س‬َ‫ي‬
َ
‫ل‬ُ‫ج‬َّ‫الر‬ْ‫ِن‬‫م‬ٍ‫ِيل‬‫ل‬
َ
‫ق‬َ‫و‬ٍ‫ي‬ِ‫ث‬
َ
‫ك‬ِ‫م‬ْ‫ن‬ِ‫ِيع‬
َ
‫َج‬ِ‫وب‬ُ ‫ر‬
‫الُّض‬َ‫و‬
‫لـى‬
َ
‫ع‬ِ‫اع‬َ‫ن‬ َّ‫الص‬َ‫و‬
َ
‫ف‬ْ‫ي‬
َ
‫ك‬‫لك‬
َ
‫ذ‬َ‫ب‬َ‫ت‬
َ
‫ك‬
َ
‫ف‬ِ‫ه‬ِ ِّ‫ط‬
َ
ِ‫ِب‬:ُ‫س‬ْ‫م‬ُْ
‫ْل‬
َ
‫أ‬َ‫د‬
ْ
‫ع‬َ‫ب‬ِ‫ة‬
َ
‫ون‬
ُ
‫ؤ‬َ‫م‬
ْ
‫ال‬.
One of our companions had written a letter to Abu Ja’far ath-Thaani – Imam al-Jawad, peace
be upon him, saying, “Please advise us concerning the khums for that which is excess from all
that a person spends from either a small amount or great amount…” The Imam, peace be
upon him, replied in his own handwriting that, “Khums is (obligatory) after the expenses
(have been covered).”
Wasaa’il al-Shi’a, vol. 6, tradition 1, sec. 8

KHUMS IN THE QUR’AN
‫ا‬َ‫م‬
َّ
‫ن‬
َ
‫أ‬ ‫وا‬ُ‫م‬
َ
‫ل‬
ْ
‫اع‬َ‫و‬ٍ‫ء‬ْ َ
‫َش‬ ْ‫ن‬ِِّ‫م‬ ‫م‬ُ‫ت‬ْ‫م‬ِ‫ن‬
َ
‫غ‬ِ‫ل‬‫و‬ُ‫س‬َّ‫ِلر‬‫ل‬َ‫و‬ ُ‫ه‬ َ‫س‬ُ ُ
‫ُخ‬ ِ
ِّ
ِ‫لِل‬
َّ
‫ن‬
َ
‫أ‬
َ
‫ف‬
“And you Muslims must all know that whatever you gain as
wealth, a fifth of it (20%) is for Allah and for the Messenger,
Muhammad…”
Surah al-Anfal (8), Verse 41

‘WHATEVER’ OF A THING YOU
ACQUIRE
KHUMS
1
Surplus or
profit of
income
2
Legitimate
wealth
mixed with
illicit wealth
3
Mines and
minerals*
4
Precious
stones
obtained
from the sea
by diving*
5
Treasures*
6
Land which a
dhimmi non-
believer
purchases
from a
Muslim living
in a Muslim
country*
7
Spoils of
war*
These last five are not applicable on MOST Shia living in the West

SURPLUS OR PROFIT OF INCOME
Surplus or Profit
Not used within a year
Earnings from
business or
wages/salary
at work or
investments
Gifts, prizes,
bonuses you
receive
Charity
(sadaqah)
which a
person is
given to live
off of
Zakat and
khums which a
person is
given to live
off of
Unexpected
inheritance
from a distant
relative or
friend
These last four are based on al-Ihtiyaat al-Waajib – an Obligatory Precaution, thus, one can refer to the next most knowledgeable Marja in these issues.

EXEMPTIONS FROM KHUMS
These items are
EXEMPT FROM KHUMS FOREVER
Mahr Inheritance
Insurance
payout for
personal
injury
Loans –
from
person or
institute

NOTE: If a person borrows money from an individual or institute (Bank) for a
purchase such as an RESP or RRSP, then there IS Khums on that savings. Also, if
a person takes a loan to purchase food, clothing, personal items, etc. and they
don’t use those purchased items for one year and they are still new, then there
IS Khums on those items at their current market value.

KHUMS is applicable on our NET
SAVINGS after all JUSTIFIABLE
expenses are covered

EXPENSES: ELIGIBLE
EXAMPLES OF VALID EXPENSES
Food and drink Accommodation
Transportation Furniture and appliances
Educational expenses Medical expenses
Marriage expenses Hajj, Ziyarat expenses
Donations Religious dues
Gifts Paying back debts
Legal penalties Wages of employees
Insurance premiums (life, medical, property, car, fire, etc…) Membership dues, etc…
Mandatory salary deductions like CPP, RSP, Stocks, etc… Taxes paid to the government, etc…

EXPENSES: INELIGIBLE
EXAMPLES OF INVALID EXPENSES
Anything spent on impermissible such as
drugs, alcohol, lottery tickets and ANYTHING
which the Shari’ah deems as forbidden.

RRSP – REGISTERED RETIREMENT
SAVINGS PLAN
As this is a form of savings, it is khums-liable and must
be paid.
Q: What about the increment in the form of interest or
capital gains in your RRSP?
A: No need to pay until you cash it in and begin to
draw from it. Ensure that you keep clear records and
when you begin to draw, take it with the intention of the
“interest” and not the principal which is now khums-free.

TFSA – TAX-FREE SAVINGS
ACCOUNT
As this is a form of savings, it is khums-liable and must
be paid.
capital gains in your TFSA?
A: If it is in a regular savings account, then you must pay
khums on the initial contribution as well as the gains
received; if it is locked in to an investment that you cannot
access, you must still pay on the initial contribution, but not
on the gain until you get it.

RESP – REGISTERED EDUCATION
SAVINGS PLAN
As this is a form of savings, it is khums-liable and must be
paid.
capital gains in your RESP AND the portion contributed by
the Federal Government of Canada IF the child decides to
go for further education?
A: As the Subscriber (parents) retain ‘ownership’ of these
funds, there is NO khums on it. HOWEVER if the parents
transfer an amount to the child and it stays for ONE YEAR
with the child, then it is khums liable.

CHILD ALLOWANCE
If the parents use it for day to day expenses, and nothing remains
at the end of the year, then no khums.
If the parents save it for the children’s future, then:
 Ayatullah Seestani – There is khums payable [Note that Scholars differ on
whether or not non-Baligh children are obligated to pay khums – please
refer to your Scholar for the ruling applicable to your scenario.].

SAVING FOR A HOME
FIRST TIME HOME BUYER: If a person is saving
for a first time home purchase and the home is
within your status AND not buying a house would
be seriously considered by the people in your
society as a sign of neglect of your duty towards
your family, then for that time period of saving,
THERE IS NO KHUMS – but once down payment
is given and home is purchased, then all future
savings MUST have khums paid on it.

SAVING FOR A CHILD’S WEDDING
Money or items accumulated over many years for a
daughter’s marriage is exempt from khums.
The same exemption applies for one’s son’s marriage
(according to Ayatullah Seestani), if such expenses can
not be met in normal circumstances from one’s normal
income.
This is applicable for cash or gifts – no matter how far
in the future the wedding will be but this MUST be
kept aside with the PURPOSE of marriage.

NEW UNUSED ITEMS
New items which have not been used are khums-liable on your
khums date:
1. A new and unused shirt, watch, ring, purse, shoes,
smartphone, etc… which have a resale value in the market –
on its CURRENT retail price.
2. Used items at home which have no market value as they
are open and used – such as cologne, perfume, soap,
toothpaste, food, etc… are NOT khums-liable.

BURIAL ITEMS
New items which have not been used are khums-liable on your
khums date:
1. Kafan: And all other items that you store for your burial
are KHUMS liable one year after purchasing it.
2. BURIAL PLOT: If plot is not owned by you and you pay to
a Institute for the right of burial, there is NO khums on the
plot; however if you OWN the land/plot, then if one year
passes and it is not used, then khums is applicable on it.
Kafan Cloth and all related items for burial

GIFTS BY THOSE WHO DON’T PAY
KHUMS
If you receive a physical gift or
money from a person who does
not pay khums, you can still use it
or take it and you are not liable
to pay khums on it.

PERMANENT LIFE INSURANCE
The premiums paid for "permanent life
insurance“ also called “whole life insurance”
cannot be counted as deductible expenses, rather
it is a type of "saving" which will be paid either
to the insured person himself (at the maturity of
the policy) or to his heirs (in case of his death
before the maturity). Like all the other savings,
such insurance premiums are liable for khums.

OTHER TYPES OF INSURANCE
Premiums paid for most of the other
insurance policies like automobile, house,
medical and other types of protection
insurance can be counted as deductible
expenses and deducted from the annual
income – thus, NO khums applicable and the
same holds true for Jamaat “burial schemes”.

MANDATORY (CPP) AND NON-
MANDATORY PENSION
1. Mandatory pension: Consider it as part of your income when you get it and pay
khums if you save anything from it in that year.
2. Non-Mandatory pensions: You have to pay khums on the money that you set
aside that year. If you invest a large sum and find yourself without enough liquid
assets to pay khums, you must work out an installment plan with your Marja’ or his
representative to pay khums in a timely fashion.

LIMITS ON HOUSEHOLD EXPENSES?
Household expenses differ from person to person. The manner and
amount of the expenditure should be considered according to the
needs and status of the person himself.
1. For example:
1. Net Income = $80,000.00;
2. Should be spending $50,000.00 but exceeds limit on items of GREED and not
NEED and spends $70,000.00;
3. Khums to be paid on net savings of $30,000.00 ($6,000.00) and NOT on
$10,000.00 ($2,000.00) .

LIMITS ON HOUSEHOLD EXPENSES?
1. For example:
1. Net Income = $80,000.00;
2. Should be spending $50,000.00 but is excessively miserly and does not
spend enough and so spends $40,000.00;
3. Khums to be paid on net savings of $40,000.00 ($8,000.00) and NOT
on $30,000.00 ($6,000.00) .

WOMAN WHO EARNS
It is obligatory on a woman who
earns her own income to pay
khums from the surplus of her
income after her legitimate
expenses.

INHERITANCE RULES AND KHUMS
If a person dies before the end of his fiscal year, his heirs must first deduct his
expenditure of that year up to the time of his death and then pay khums from
the surplus of the remaining income. Only then can the heirs take their shares
from the estate. If the heirs knew for certain that the deceased had not paid
khums from his estate, then according to obligatory precaution, they must pay
khums before dividing the estate.

WHEN TO PAY KHUMS
Khums becomes obligatory at the beginning of the
new financial year on the profit or surplus of the
past year’s income.

HIJRAH OR COMMON ERA
CALENDAR?
1. Can use either the Common Era (CE)
calendar or the Islamic (AH) calendar.
2. If you use the Common Era Calendar,
you gain 10 days a year to spend; so
every three years, you gain one extra
month of spending.

HOW MUCH IS KHUMS?
80%
Khums
50% is Imam’s Portion
50% is Sadaat’s Portion
20%
Expenses Net Savings

CALCULATION OF KHUMS
Take all of your cash/liquid savings,
value of unused items and all other
things upon which khums is payable
upon and multiply that figure by 20% -
this is your TOTAL khums due.
For example:
$50,000.00 (savings) x 20% =
$10,000.00 khums
payable

KHUMS DIVISION
Portion of the Imam
50%
Portion of the Sadaat
50%
DIVISIONS

KHUMS DIVISION
According to the verse of khums, this “Islamic tax” is
for:
(1) Allah
(2) the Messenger of Allah
(3) the near relative of the Messenger
(4) the orphans
(5) needy
(6) stranded traveler

SHARES OF KHUMS
1. First two shares belong to Allah and Prophet Muhammad.
2. The third share, that of "the near relative" belongs to the
infallible Imam of the time – in our case the 12th Imam.
3. The latter three shares belong to those of the Hashimite family
who are orphan, needy and stranded traveler.

FIRST TWO PORTIONS OF KHUMS
Allah does not come in person to take His share of
Khums; therefore the Prophet, as Allah’s
representative on this earth, is the authority in
charge of receiving both his own share of Khums
and that of Allah.

PROPHET’S SHARE OF KHUMS
What is to be done with the Prophet’s
share after his death?

After the Prophet’s death, the shares
of Allah and the Prophet belong to
his rightful successor and the present
rightful successor of the Prophet is
Imam Muhammad al-Mahdi.

Since the present Imam, besides owning his
own share as "the near relative," is also the
rightful owner of Allah’s and the Prophet’s
shares of khums, the first half of khums is
commonly known as the share of the Imam.

IMAM’S PORTION OF KHUMS
During the Presence of the Imam
The first half of khums is the share of the Imam. During the
presence of the Imams, the portion of the Imam was given to them
directly or to their specially appointed agents. The Imam, as the
head of the sadat, was also responsible for distribution of portion
of the sadaat.

During the Occultation of the Imam
 At the present time, the 12th Imam has not appointed anyone as his
special agent.
 The share of the Imam must be used for the causes which the Imam
would agree with.
 Must be given to the most learned Mujtahid (that you perform Taqleed
of) or be used in the way authorized by the Mujtahid.

During the Occultation of the Imam
1. Help the poor and needy Shi’a Ithna-Asheri globally;
2. Education and propagation of the religion of Islam and the teachings of
Ahlulbayt;
3. Supporting religious scholars and students who dedicate their life in studying
and teaching Islam;
4. Building of religious establishments (masaajid, imambargah, etc.).

Much of the portion of the Imam does not reach the Mujtahids
themselves, rather it is used, with their permission, in various parts
of the world. Many religious and charitable works being done by
the Shi’a in the West today are from the portion of the Imam.

Hawza `Ilmiyya of Qum - 1980s:
~ 15,000 students and teachers x $30.00 for each
one as a monthly stipend = $450,000.00
Hawza `Ilmiyya of Qum - TODAY:
~ 40,000 students and teachers x $150.00 for each
one as a monthly stipend = $6,000,000.00

SCHOLARS DURING THE
OCCULTATION
The portion of the Imam plays an
important role in the financial
independence of our scholars as they
CANNOT depend on governments or
other organizations for their livelihood as
this prevents any unwarranted influence.

SADAAT PORTION OF KHUMS
The second half of khums is for the orphan, the needy and the
stranded traveler from the Prophet’s family, that is, the Hashimite. A
Hashimite is the one who, from his father’s line, is a descendent of
Hashim, the great grandfather of the Prophet.

However, the Hashimites who descend from Fatimah, the daughter
of the Prophet, have preference over other Hashimites. Since the
descendants of Fatimah are commonly known as "sayyid, pl.
sadaat," the second half of khums is known as the portion of the
sayyid.

The recipients of the portion of the Sayyid change all the time:
1. An ’orphan’ ceases to be an orphan as soon as he becomes an
adult;
2. A ’needy’ ceases to be needy as soon he becomes financially
independent;

3. An traveler who has no money to continue his journey back to his home is also allowed to
receive a portion of khums provided his journey is not for any unlawful purpose. Khums can be
given to such a sayyid to continue his journey even if he is a wealthy person in his own town.
It is not permitted to give khums to a sayyid whom you know will
spend any of it in a sinful act or one who commits sins in the public.

WHO TO GIVE YOUR KHUMS TO?
Your Marja Taqleed
directly
Local Scholar who
holds permission
Local, National or
International
Institutions who hold
permission

THE MORE YOU GIVE, THE MORE
YOU RECEIVE

REFERENCES FOR THIS
PRESENTATION
1. Khums: An Islamic Tax - Seminar & Q&A @
https://www.youtube.com/watch?v=OzYORfufQU8
2. Khums: An Islamic Tax – the book @ http://www.islamic-laws.com/download/khums_laws.pdf
3. Khums by Ayatullah Nasir Makarim Shirazi:
PART 1
PART 2
PART 3

OTHER REFERENCES AVAILABLE
1. Response to accusations against Khums @ http://www.islamic-
laws.com/pdf/Critiqueofquestonkhums.pdf
2. Khums: The Islamic Tax System from Ahlulbayt TV by Sayyid Muhammad Rizvi @
https://www.youtube.com/watch?v=MDAtRUzSC_E
3. Khums Seminar in Dar es Salaam by Sayyid Muhammad Rizvi @
https://www.youtube.com/watch?v=cxiXyqu8jbI
4. Understanding the Laws of Khums by Shaykh Murtaza Bachoo @
https://www.youtube.com/watch?v=nBFOoDMDSR4

FURTHER QUESTIONS?
If you have further questions or require
clarification contact Shaykh Saleem Bhimji from
the CONTACT US LINK

Khums Rulings Seminar

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