Fatwa #156823 November 2000Pakistan

Salary package and use of allownace in accordance with Islamic shariah.

Question

As part of my salary package, the company offered me a car allowance, pension and medical aid. Withregards to the car allowance, I have to purchase and the asset belongs to me. I took the option for tax benefit. However, I pay interest and am concerned. Should I pay off the capital if I have funds or allow the term to run. With regards to the pension & medicl aid this is compulsory.

Answer

It is not permissible to incur an interest bearing transaction to reduce tax payments.

and Allah Ta'ala Knows Best

Mufti Ebrahim Desai
FATWA DEPT.

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