Muslims do not have to pay Zakah on funds frozen in Saudi bank accounts if they have trouble renewing their residence permits, according to an expert in Islamic jurisprudence.
These people are exempted from paying the tax, Mohamed Al-Nujaimi, a scholar at the International Islamic Fiqh Academy, told Arab News.
“There are no Zakah payments required by expats who have frozen bank accounts for one year or a number of years.”
He said the financial problems created by freezing their accounts mean they would need their money when it is eventually released by the banks.
There has been confusion among expatriates about whether they should pay Zakah on their money.
Banking experts and other scholars could not be reached for comments to confirm Al-Nujaimi’s remarks.
Amer Mahmoud, a Sudanese expatriate who works for a private company, believes he should pay Zakah on the money frozen in his bank account.
“I have spent more than three years trying to renew my iqama. My bank account was frozen because I had an expired iqama.”
He said he was considering the possibility of getting a new sponsor and a new iqama so that he can get access to his money.
“I will then be able to update my bank accounts and withdraw my money but I have to pay Zakah for each year,” said Mahmoud.
Saudi banks freeze the accounts of both Saudi citizens and expatriates when their identification cards expire. When that happens, they are unable to withdraw money or renew their ATM cards. However, their accounts can still receive deposits.
If customers do not renew their documentation within 180 days after their accounts are frozen, then their accounts are closed.
Banks are obliged under the law to inform customers they will be freezing or closing their accounts.
Zakah exemption on frozen funds?
