Contents Introduc)on Basis of Islamic inheritance Estate Planning - - PowerPoint PPT Presentation

Contents

Introduc)on Basis of Islamic inheritance Estate Planning in rela)on to Shari’ah Law

Introduc)on Compliance Sources of Islamic Law

Primary - Quran Secondary

Narrated by the Prophet Ijma

Islamic Inheritance

Basis of Islamic inheritance

Quran & Sunnah of the Prophet (S.A.W)

• “Allah (thus) directs you as regards your Children's (Inheritance): to the male, a por,on equal to that of

two females: if only daughters, two or more, their share is two-thirds of the inheritance; if only one, her share is a half. For parents, a sixth share of the inheritance to each, if the deceased leA children; if no children, and the parents are the (only) heirs, the mother has a third; if the deceased LeA brothers (or sisters) the mother has a sixth. (The distribuEon in all cases ('s) a7er the payment of legacies and debts. Ye know not whether your parents or your children are nearest to you in benefit. These are se>led por,ons

• rdained by Allah; and Allah is All-knowing, Al-wise.”

Al Nisa, Verse 11

• “In what your wives leave, your share is a half, if they leave no child; but if they leave child, ye get a fourth;

a7er payment of legacies and debts. In what ye leave, their share is a fourth, if ye leave no child; but if ye leave a child, they get an eighth; aAer payment of legacies and debt, if the man or woman whose inheritance is in quesEon, has leA neither ascendance or descendants(kalalah), but has leA a brother or a sister, each one of the two gets a sixth. Should there be more than two, they share one third aAer payments

• f legacies and debts. This is sEpulated so that no loss is caused (to any one). Thus is it ordained by Allah,

and Allah is All-Knowing and Most Forbearing.” Al Nisa verse 12

Basis of Islamic inheritance (cont.)

“They ask thee for a legal decision. Say: Allah directs (thus) about those who leave no descendants or ascendants as

• heirs. If it is a man that dies, leaving a

sister but no child, she shall have half the inheritance: if (such a deceased was) a woman, who leA no child, her brother takes her inheritance: if there are two sisters, they shall have two- thirds of the inheritance (between them): if there are brothers and sisters, (they share), the male having twice the share of the female. Thus doth Allah make clear to you (His law), lest ye err. And Allah hath knowledge of all things.” Al Nisa verse 176

Basis of Islamic inheritance (cont.)

The Quranic verses spell out:

Who should inherit How much they should inherit How one may inherit How one heir blocks / excludes another heir from inheri)ng That males will receive double the share of females

Order of rights to estate

Islamic Jurists concur rights are graded in the following order:

Funeral Expenses Debts

Religious Obliga)ons Others

Wasiyyah (Legacy) Balance to heirs (Inheritance)

Prescribed / fixed shares Residual shares

Wasiyyah & Inheritance

Wealth Funeral Expenses & Debts Estate Wasiyyah

• In terms of

Instruc)ons

Inheritance

• In terms
• f

Quraan

Wasiyyah - Legacy

It is a bequest or an instruc)on in a Will Concept confirmed in Islamic Law Our prophet Muhammad (PBUH) had said: “Truly Allah had given you a sadaqah (charity) of one third

• f your en)re wealth that serves as an increment to your
• deeds. Place it wherever you want to or (give it) to

whomsoever you like” reported by Bukhᾱriy Can consist of money, assets, benefits, usufruct over assets. Can include instruc)ons i.r.o. burial arrangements, conduct of life by heirs, etc.

Wasiyyah – Legacy (cont.)

Cannot exceed 1/3 of persons estate acer expenses (funeral, debt etc.) Those who benefit as heirs i.t.o surah Al-Nisa cannot again benefit out of this 1/3 alloca)on If any Quranic heirs are blocked / excluded then they can benefit from the 1/3 alloca)on. Non-muslims and chari)es can benefit The bequest / instruc)ons is implemented acer death Can be changed any )me before death

Inheritance

Estate Inheritance Residual Shares Prescribed /Fixed Shares Wasiyyah

Inheritance

Inheritance

Prescribed / Fixed Shares Residual Shares

Wasiyya / Legacy Estate

Inheritance (cont.)

Based on rela)ves alive on date of death Know family rela)onships well; as different rela)onships have different effects Deprived rela)ves

Adopted child Ex-wife Illegi)mate child Non-Muslim

Understand blocking / excluding principle Alloca)on in terms of:

Prescribed / fixed shares Residual shares

Prescribed / Fixed shares

(in relaCon to the deceased)

Husband – 1/4 , 1/2 * Wives – 1/4 , 1/8* Daughters – 1/2 , 2/3* Father – 1/6* Mother – 1/6, 1/3* Granddaughters – 1/2 , 2/3 Grandfather – 1/6 Grandmothers – 1/6 Sisters – 1/2 , 2/3 * Cannot be screened (blocked) See annexure for details

Prescribed / Fixed shares explained

(in relaCon to the deceased)

Husband

Possible shares

1/2 – No Children 1/4 – Has Children

Confirmed Share

Cannot be blocked / excluded

Wives

Possible shares

1/4 – No Children 1/8 – Has Children

Confirmed Share

Cannot be blocked / excluded

Prescribed / Fixed shares explained (cont.)

(in relaCon to the deceased)

Father

Possible minimum share

1/6 – No Children

Confirmed Share

Cannot be blocked / excluded

Blocks / excludes

Grandparents Siblings Nephews & their sons

Mother

Possible minimum shares

1/3 – No Children 1/6 – Has Children or mul)ple siblings

Confirmed Share

Cannot be blocked / excluded

Blocks / excludes

Both grandmothers

Prescribed / Fixed shares explained (cont.)

(in relaCon to the deceased)

Grandfather

Possible shares

1/6

Condi)ons

Absence of a father

Blocks / excludes

Nephews & their sons

Grandmother

Possible shares

1/6

Condi)ons

Absence of a mother Absence of a father

Excep)on for maternal grandmother

Prescribed / Fixed shares explained (cont.)

(in relaCon to the deceased) Granddaughters (only from son)

Possible shares

1/2 – 1 granddaughter 2/3 – mul)ple granddaughters 1/6 – 1 daughter

Condi)ons

Absence of mul)ple daughters Absence of son

Daughters

Possible shares

1/2 – 1 daughter 2/3 – Mul)ple daughters

Condi)ons

Absence of a son

Confirmed share

Cannot be blocked / excluded

Prescribed / Fixed shares explained (cont.)

(in relaCon to the deceased)

Sisters

Possible share

1/2 – 1 sister 2/3 – mul)ple sisters

Condi)ons

Absence of a daughter / granddaughter Absence of a brother Absence of father / grandfather

Residual Shares

(in relaCon to the deceased)

Once the Quranic prescribed / fixed shares have been determined in terms

• f their propor)ons, the residual shares (balance / taseeb) is allocated

2:1 raCo for male and female Priority / Ranking (taseeb)

Sons & daughters Grandsons & Granddaughters Father Brothers & Sisters Nephews & their sons Uncles & their sons

It is possible to get a share through prescribed / fixed shares and through residual shares

The Common Clause

I appoint as the heirs of the whole of my Estate my heirs in accordance with Islamic Law, provided that the effect of this clause, and the por)on of my Estate each of my heirs are each to receive shall be cerCfied by an expert in that Law, or qualified Islamic theologian, or a non-profit organisa)on which, in the ordinary course of their

• pera)ons

provide such cer)ficates, appointed by my Executors in their en)re discre)on and such cer)fica)on shall be proof of the dictates of Islamic Law in this regard

Inheritance Calculators:

hlp://inheritance.ilmsummit.org hlp://www.islamicsocware.org/irth/irth.html

See table Complete Click calculate

IllustraCon with Examples

Heirs / Beneficiaries in relaCon to deceased (male)

Wife, 1 son, 2 daughters & parents Wife, 1 son & 2 daughters Wife, 2 daughters (son predeceased leaving a son) Wife, 1 son, 1 daughter (daughter predeceased, leaving 1 son )

Wife 1/8 (12.5%) 1/8 (12.5%) 1/8 (12.5%) 1/8 (12.5%) Mother 1/6 (16.67%) Deceased Deceased Deceased Father 1/6 (16.67%) Deceased Deceased Deceased Son 13/48 (27.08%) 7/16 (43.75%) Deceased 7/12 (58.33%) Daughter 1 13/96 (13.54%) 7/32 (21.88%) 2/6 (33.34%) Deceased Daughter 2 13/96 (13.54%) 7/32 (21.88%) 2/6 (33.43%) 7/24 (29.17%) Son of Son N/B N/B 5/24 (20.83%) 0% Son of Daughter 1 N/B N/B N/B 0%

(N/B – not born yet) Colour coded:

Fixed Residual Not applicable

Special Cases

Simultaneous deaths Missing person Adopted children Step Children Mul)ple wives Aul / Radd adjustments Reverts (embracing Islam) Foetus Divorce Absence of Standard heirs

ApporConment of Assets – a challenge

Heirs / Beneficiaries in relaCon to deceased (male)

Wife Son Daughter Daughter

House R1,000,000 Car R100,000 Investments R100,000 Insurance Policies ??? Share (100%) 1/8 (12.5%) 7/16 (43.75%) 7/32 (21.88%) 7/32 (21.88%) Inheritance Value R1,200,000 R150,000 R525,000 R262,500 R262,500 Total Allocated Difference