The Khums is a financial duty that is carried out with the intention of attaining nearness to Allah (Qurbah). In comparison to zakat, it is obligatory on all possessions except the woman’s dowry and any expected inheritance. The term khums is derived from the ratio one in five (20%). In the following section, we are going to explain the conditions that make the khums obligatory and some of its general rulings in accordance with the view of His Eminence, Sayyed Muhammad Hussein Fadlullah (ra), as mentioned in Islamic Rulings, A Guide to Islamic Practices:
For Khums to be obligatory, the following conditions must be met:
First and second: Bulough (age of Maturity) and sanity: Khums is not obligatory on the possessions of young children until they reach the age of maturity, nor on the possessions of the insane person until they become sane, if their insanity is constant. However, if their insanity occurs only sporadically, khums becomes obligatory on them; the same ruling applies to the person who repeatedly falls unconscious. That said, an exception to this is a young child’s possession of money mixed with unlawful money, in which case the guardian must pay its khums even before the child reaches puberty.
Third: Khums is not obligatory on a non-Muslim during the period when they are non-Muslim, except if a non-Muslim buys land from a Muslim; in that case, they must pay khums on it.
Fourth: Khums is obligatory on some possessions, such as treasures and minerals, if they reach the threshold, but not others.
Fifth: Khums is not obligatory on possessions owned by entities such as the state, institutions, or mosques… However, Khums is obligatory on possessions owned by individuals even if owned by multiple persons.
It is not conditional for khums to be applicable that the possession is physically present with the owner. The only consideration here is that the owner of a possession expects to have it returned to him has the choice between paying khums while the possession is still not in their possession or waiting until they retrieve it. However, khums is not obligatory on possessions that are unlikely to return to their owner unless they do return to them, in which case the khums becomes obligatory.
Estimating the khums:
If the conditions for khums exist, it becomes obligatory on the person to pay the khums at the specified time without delay. However, since the external elements in the khums differ based on whether the asset is money or goods, its purpose (for business or possession), and whether a person owns it as money or a loan, the estimation and calculation of the khums differ in three different cases:
First: If the asset subject to khums is money or goods, and the person wants to pay khums from the asset itself, rather than from something else, and if the parts of the asset are of equal value, a person may pay its khums without issue; However, if the parts differ in value, it is not sufficient to pay khums only on the lower-valued part. Instead, they must assess the difference in value and pay an amount equal to the khums of the total, either from the same asset or a different one.
Second: If the person wishes to pay khums from another asset, they must estimate these assets at their current value and pay khums accordingly, even if their current value is less than the purchase cost. However, it is preferable to pay khums based on the purchase value. The same ruling applies to business assets.
That said, if they borrowed money to buy a car, for example, for personal use—regardless of whether it was for the maintenance of their business—and then began repaying the loan from the profits of subsequent years, in this case, after they have fully repaid the loan, and if khums was applicable to it, they are not obliged to pay khums on the increase over the purchase price paid with the borrowed money. However, if selling it would generate a profit and its market value increases, khums on the increase becomes obligatory.
Third: If the assets were purchased with money from the profits of the previous year that were subject to khums but they did not pay khums, in this case, they must pay khums on the money only. For example, if they bought a house using saved money that was subject to khums, regardless of its current or past value, they must pay khums on the price they paid when purchasing the house. However, if the house was bought to generate profit, they must pay khums on both the purchase price and the increase in value, treating it as business capital, as previously explained.
If the person is uncertain whether the asset, which has been in their possession for one year, was purchased using saved money (in which case they would estimate khums based on the purchase price or using profits from the purchase year (in which case they would estimate khums based on its current value), they must estimate khums according to its current value.
The Khums is a financial duty that is carried out with the intention of attaining nearness to Allah (Qurbah). In comparison to zakat, it is obligatory on all possessions except the woman’s dowry and any expected inheritance. The term khums is derived from the ratio one in five (20%). In the following section, we are going to explain the conditions that make the khums obligatory and some of its general rulings in accordance with the view of His Eminence, Sayyed Muhammad Hussein Fadlullah (ra), as mentioned in Islamic Rulings, A Guide to Islamic Practices:
For Khums to be obligatory, the following conditions must be met:
First and second: Bulough (age of Maturity) and sanity: Khums is not obligatory on the possessions of young children until they reach the age of maturity, nor on the possessions of the insane person until they become sane, if their insanity is constant. However, if their insanity occurs only sporadically, khums becomes obligatory on them; the same ruling applies to the person who repeatedly falls unconscious. That said, an exception to this is a young child’s possession of money mixed with unlawful money, in which case the guardian must pay its khums even before the child reaches puberty.
Third: Khums is not obligatory on a non-Muslim during the period when they are non-Muslim, except if a non-Muslim buys land from a Muslim; in that case, they must pay khums on it.
Fourth: Khums is obligatory on some possessions, such as treasures and minerals, if they reach the threshold, but not others.
Fifth: Khums is not obligatory on possessions owned by entities such as the state, institutions, or mosques… However, Khums is obligatory on possessions owned by individuals even if owned by multiple persons.
It is not conditional for khums to be applicable that the possession is physically present with the owner. The only consideration here is that the owner of a possession expects to have it returned to him has the choice between paying khums while the possession is still not in their possession or waiting until they retrieve it. However, khums is not obligatory on possessions that are unlikely to return to their owner unless they do return to them, in which case the khums becomes obligatory.
Estimating the khums:
If the conditions for khums exist, it becomes obligatory on the person to pay the khums at the specified time without delay. However, since the external elements in the khums differ based on whether the asset is money or goods, its purpose (for business or possession), and whether a person owns it as money or a loan, the estimation and calculation of the khums differ in three different cases:
First: If the asset subject to khums is money or goods, and the person wants to pay khums from the asset itself, rather than from something else, and if the parts of the asset are of equal value, a person may pay its khums without issue; However, if the parts differ in value, it is not sufficient to pay khums only on the lower-valued part. Instead, they must assess the difference in value and pay an amount equal to the khums of the total, either from the same asset or a different one.
Second: If the person wishes to pay khums from another asset, they must estimate these assets at their current value and pay khums accordingly, even if their current value is less than the purchase cost. However, it is preferable to pay khums based on the purchase value. The same ruling applies to business assets.
That said, if they borrowed money to buy a car, for example, for personal use—regardless of whether it was for the maintenance of their business—and then began repaying the loan from the profits of subsequent years, in this case, after they have fully repaid the loan, and if khums was applicable to it, they are not obliged to pay khums on the increase over the purchase price paid with the borrowed money. However, if selling it would generate a profit and its market value increases, khums on the increase becomes obligatory.
Third: If the assets were purchased with money from the profits of the previous year that were subject to khums but they did not pay khums, in this case, they must pay khums on the money only. For example, if they bought a house using saved money that was subject to khums, regardless of its current or past value, they must pay khums on the price they paid when purchasing the house. However, if the house was bought to generate profit, they must pay khums on both the purchase price and the increase in value, treating it as business capital, as previously explained.
If the person is uncertain whether the asset, which has been in their possession for one year, was purchased using saved money (in which case they would estimate khums based on the purchase price or using profits from the purchase year (in which case they would estimate khums based on its current value), they must estimate khums according to its current value.