Sharia compliant tax saving schemes in India
I am from India and I work as a software engineer. Every month tax is deducted from my account. In order to save tax I have to invest in many tax saving government schemes.
Q1) Can i invest some of my money in ELSS. ELSS is a scheme where every month you invest some of your money. This money is invested in mutual funds. You cannot withdraw your money for a period of 3 years. After 3 years you will get your money based on the market value of your investment. What if after 3 years I don’t take any profit gained from it and take only the amount I have invested. Will it be halal for me? I just want to invest in it for tax saving purpose.
Q2) If the above is not halal what are the other sharia complaint tax saving schemes in India? I don’t have a huge amount to be invested all at once in the beginning.
Wa’alaykum as Salam wa rahmatullahi wa barakatuhu,
ELSS does not provide any Islamic investments. Furthermore, It will not be permissible to invest and only withdraw your capital, since your funds will be accruing interest.
We have been trying to check the Shariah compliance of Tata Ethical Fund and Taurus Ethical. However, since we are in a different country, it is difficult for us to gather enough information.
We suggest that you get the contracts from these two companies, and send them to Hadhrat Mawlana Khalid Saifullah: http://khalidrahmani.in/english/about_moulana/
Alternatively, you can ask the Darul Iftaa of Darul Ulum Deoband: http://www.darulifta-deoband.com/
Insha Allah, they will guide and assist you.