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Benefit in Kind: Should It Be Exempted from Zakat?

In general, emoluments, allowances and all forms of income related to employment are considered as employment income zakat in Malaysia. However, based on the practice of zakat institutions in Malaysia, not all that is received in relation to employment is liable for mandatory zakat, including all...

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Main Authors: Hamat, Zahri, Firdaus, Radin Badaruddin Radin, Shaharudin, Samsurijan Mohamad
Format: Article
Language:English
Published: Universiti Sains Islam Malaysia (USIM) 2017
Subjects:
H Social Sciences (General)
Online Access:http://eprints.usm.my/39198/1/Ulum_Islamiyyah.pdf
http://eprints.usm.my/39198/
http://uijournal.usim.edu.my/index.php/current-issues/262-benefit-in-kind-should-it-be-exempted-from-zakat
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spelling my.usm.eprints.39198 http://eprints.usm.my/39198/ Benefit in Kind: Should It Be Exempted from Zakat? Hamat, Zahri Firdaus, Radin Badaruddin Radin Shaharudin, Samsurijan Mohamad H Social Sciences (General) In general, emoluments, allowances and all forms of income related to employment are considered as employment income zakat in Malaysia. However, based on the practice of zakat institutions in Malaysia, not all that is received in relation to employment is liable for mandatory zakat, including all forms of benefit in kind (BIK). On the other hand, in terms of taxation practice, all benefits in kind received by an employee are taxable by Inland Revenue Board of Malaysia (LHDN), except for benefits listed in Paragraph 9. BIK refers to benefits given to employees, which cannot be convertible into money, such as motorcar and household furnishings, apparatus and appliances. It is worth noting that the discussion on the imposition of zakat on benefits in kind has not been given enough thought and justifiably raises questions. Therefore, in this study, three central questions have been raised with regards to BIK and zakat in Malaysia. Should BIK be considered under the category of “whatever received related to employment”? Why BIK should be subjected to employment income zakat? How BIK can be charged under the context of employment zakat? Based on the content analysis method, this paper presented a brief review to answer these questions. In general, this study is of the opinion that BIK is zakatable and LHDN’s income tax assessment method could be adopted for employment income zakat accounting. Universiti Sains Islam Malaysia (USIM) 2017-12 Article PeerReviewed application/pdf en http://eprints.usm.my/39198/1/Ulum_Islamiyyah.pdf Hamat, Zahri and Firdaus, Radin Badaruddin Radin and Shaharudin, Samsurijan Mohamad (2017) Benefit in Kind: Should It Be Exempted from Zakat? 'Ulum Islamiyyah: The Malaysian Journal of Islamic Sciences, 22. pp. 1-8. ISSN 2289 - 4799 http://uijournal.usim.edu.my/index.php/current-issues/262-benefit-in-kind-should-it-be-exempted-from-zakat
institution Universiti Sains Malaysia
building Hamzah Sendut Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Sains Malaysia
content_source USM Institutional Repository
url_provider http://eprints.usm.my/
language English
topic H Social Sciences (General)
spellingShingle H Social Sciences (General)
Hamat, Zahri
Firdaus, Radin Badaruddin Radin
Shaharudin, Samsurijan Mohamad
Benefit in Kind: Should It Be Exempted from Zakat?
description In general, emoluments, allowances and all forms of income related to employment are considered as employment income zakat in Malaysia. However, based on the practice of zakat institutions in Malaysia, not all that is received in relation to employment is liable for mandatory zakat, including all forms of benefit in kind (BIK). On the other hand, in terms of taxation practice, all benefits in kind received by an employee are taxable by Inland Revenue Board of Malaysia (LHDN), except for benefits listed in Paragraph 9. BIK refers to benefits given to employees, which cannot be convertible into money, such as motorcar and household furnishings, apparatus and appliances. It is worth noting that the discussion on the imposition of zakat on benefits in kind has not been given enough thought and justifiably raises questions. Therefore, in this study, three central questions have been raised with regards to BIK and zakat in Malaysia. Should BIK be considered under the category of “whatever received related to employment”? Why BIK should be subjected to employment income zakat? How BIK can be charged under the context of employment zakat? Based on the content analysis method, this paper presented a brief review to answer these questions. In general, this study is of the opinion that BIK is zakatable and LHDN’s income tax assessment method could be adopted for employment income zakat accounting.
format Article
author Hamat, Zahri
Firdaus, Radin Badaruddin Radin
Shaharudin, Samsurijan Mohamad
author_facet Hamat, Zahri
Firdaus, Radin Badaruddin Radin
Shaharudin, Samsurijan Mohamad
author_sort Hamat, Zahri
title Benefit in Kind: Should It Be Exempted from Zakat?
title_short Benefit in Kind: Should It Be Exempted from Zakat?
title_full Benefit in Kind: Should It Be Exempted from Zakat?
title_fullStr Benefit in Kind: Should It Be Exempted from Zakat?
title_full_unstemmed Benefit in Kind: Should It Be Exempted from Zakat?
title_sort benefit in kind: should it be exempted from zakat?
publisher Universiti Sains Islam Malaysia (USIM)
publishDate 2017
url http://eprints.usm.my/39198/1/Ulum_Islamiyyah.pdf
http://eprints.usm.my/39198/
http://uijournal.usim.edu.my/index.php/current-issues/262-benefit-in-kind-should-it-be-exempted-from-zakat
_version_ 1643709581235322880
score 13.211869

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