Q: What is the Shari’ah position with regards to zakāh on Diminishing Musharaka home purchase plans?
الجواب حامدًا و مصليًا و منه الصدق و الصواب
A: Under the Diminishing Musharakah home purchase plan, the client again incurs a debt only to the extent of the outstanding monthly rental payments subsequent to his use of the property. This debt is then settled on a monthly basis by virtue of the rental payments.
However, as in the Ijarah home purchase plan, if the client’s zakāh date arrives before such debt has been settled, it will be deductible from his zakatable assets. Funds that may have built up as a consequence of the on account payments, as is the case with some providers, are not subject to zakāh.[1]
[1]For a detailed breakdown, please see the Zakāh on Islamic Home Purchase Plans research paper on the Al Qalam website.