In some countries, if a person dies the heirs are obliged to pay taxes on the property of the deceased. For example, if the deceased left behind £400,000, the government will take £40,000 in the name of inheritance tax. Based on that, the estate cannot be divided in accordance with Islamic sharee‘ah.
My question is: is it permissible to buy insurance for the inheritance tax, as this insurance will cover the taxes imposed by the government on a person’s estate?.
Praise be to Allaah.
There is no doubt that taking taxes on the estate and other
property of people is something haraam and an obvious injustice and
consuming people’s wealth unlawfully. We have explained the prohibition on
taxes in the answer to question number
39461.
But the fact that this injustice is affecting you does not
make it permissible for you to do something haraam, which is taking out
insurance which involves a lot of ambiguity, riba and gambling, as has been
explained in the answer to question number
8889.
In the answer to question number
89805 we have quoted a fatwa
of Shaykh ‘Abd al-‘Azeez ibn Baaz (may Allah have mercy on him), stating
that it is not permissible to deal with riba for the purpose of paying taxes
from the interest.
And Allah knows best.
