Taking out life insurance to save tax

Submitted by user2 on Mon, 2018-12-31 07:32

Q: Is it permissible to buy a life insurance policy, not so that my heirs can benefit from it; but merely to cover inheritance tax/estate duty that is so exorbitant that due to not having so much cash funds in the estate, essential assets such as the house in which the heirs live in has to be sometimes sold just to pay the estate duty? The heirs will be instructed that after paying the duty, the surplus must be given away in charity without intention of reward.

A: Insurance is an embodiment of interest and gambling. Why leave the world in a state where these two curses are hanging over your head?

And Allah Ta'ala (الله تعالى) knows best.

Answered by:

Mufti Ebrahim Salejee (Isipingo Beach)

Category:

Business and Dealings›Interest and Gambling›Insurance and Medical aid

Disclaimer: The answer hereby given is specifically based on the question asked and should be read together with the question asked. Muftionline.co.za bears no responsibility to any party who may or may not act on this answer. Muftionline.co.za being hereby exempted from loss or damage whatsoever caused. Should the question refer to a matter in dispute between two parties, this answer may not be used in the dispute in question by either party unless the question was jointly submitted by both parties with an acknowledgement by both parties that the question was correct and accurate. This answer may not be used as evidence in any court of Law without prior written consent from Muftionline.co.za.

This is the standard version of the site.