The Ruling On Zakat For The Employees Provident Fund (EPF)

THE RULING ON ZAKAT FOR THE EMPLOYEES PROVIDENT FUND (EPF)

After deliberation, the Fatwa Committee of the State of Perlis agreed upon the following resolutions:

1) All types of EPF schemes are subject to obligatory zakat payment on condition that the contributor's original employment is lawful (halal).

2) Dividends provided by EPF from Shari‘ah-compliant savings accounts are also subject to zakat. As for dividends from conventional savings accounts, they require prior purification, and the remaining balance is subject to zakat.

3) A Muslim must place his or her savings into the Shari‘ah-compliant EPF savings account. If he or she has violated the Shariah directive by placing his or her money into a non-Shariah-compliant account when possessing the choice to do otherwise, then he or she must repent (tawbah), and the relevant dividend money must be purified. The Fatwa Committee of the State of Perlis recommends that the purification method may be referred to on the EPF website at http://secure.kwsp.gov.my/shariah/bm/faq.html