Fatwa #1135813 April 2004India

Is loan with interest to construct a house, just to save the Income Tax is Halal ?

Question

I am a Radiologist, and my earnings are in White money, just to save Income Tax, as I am in a Bracket of 35% [ yearly tax payable is > 7.2lakhs], can I take a loan with interest to construct a house . Other wise I my be paying around Indian Rs 60,000 per month. Please advise me as this is a huge amount and hard earned money . Dr Saleem

Answer

It is not permissible to take an interest bearing loan in order to decrease the income tax amount.

and Allah Ta'ala Knows Best

Mufti Ebrahim Desai

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