Stipulating a specific amount of the profits in a partnership

Q: I gave R500 000 to a factory owner as an investment. Every single month, he gives me R30 000. Is that R30 000 halaal or haraam?

A: It is not permissible to stipulate a specific amount of the profits. If a specific amount of the profits is stipulated, then the money earned will be interest. You should make sincere tawbah to Allah Ta'ala for entering into an interest-bearing investment and immediately end this haraam investment. The correct method of entering into a partnership is for the profit-sharing to be stipulated according to percentage. For example, one partner will receive 40% and the other will receive 60% of the profits.

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

 

Answered by:

Mufti Zakaria Makada

Checked & Approved:

Mufti Ebrahim Salejee (Isipingo Beach)