Filing Taxes in Canada

Question:

I want to ask whether filing corporate taxes, income taxes, investment taxes, or other forms of tax filing taxes is haram. Does the source of income matter or the career of the person whom I am filing taxes for? Do the investments of the person matter?

For example, if that person works in a haram career or is investing in haram companies/interest-based bonds am I liable as the person who is filing the taxes?

Answer:

In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ʿalaykum wa-rahmatullāhi wa-barakātuh.

A tax preparer, whom you have described receives compensation in exchange for services rendered in preparing, calculating, and filing income tax returns on behalf of individuals and businesses. If the accountant’s job is restricted to this alone, then there is no sin in preparing such financial statements. What the business owner who is filing their taxes or the corporation does is not the accountant’s responsibility, nor is the accountant involved in those transactions in any way.

However, the accountant should not involve themself in evaluating financial operations for a haram company by recommending best practices, identifying issues, strategizing solutions, and helping the organization to run efficiently. The accountant should also avoid offering guidance on cost reduction, revenue enhancement, and profit maximization of a haram company. They should also avoid conducting forecasting and risk analysis assessments because this constitutes direct involvement in the company. This should be avoided at all costs.

Finally, it must also be kept in mind that, a tax-accountant/consultant should render his services within the scopes of legal limits to remain within shar’I limits. Tweaking and misrepresenting book entries etc. in ways which may not be legally acceptable, or which may construe as a deception, would also be shar’an impermissible from Islamic perspective.

The famous hadith that is narrated regarding the prohibition and curse upon the one who witnesses or records a transaction of interest,

“Abdullah b. Mas’ud (Allah be pleased with him) said that Allah’s Messenger ﷺ cursed the one who consumed interest and the one who paid it and the one who recorded it, and its two witnesses,” [1] does not refer to the person who was not involved in the transaction directly. 

This is how the scholars have interpreted the Hadith: Imam al-Ubbī ^rh, the famous commentator of Sahih Muslim has explained the Hadith in the following manner:

The kātib (writer of interest) mentioned in the Hadith refers to the scribe of the document recording the transaction of ribā, and the word shāhid refers to a person who bears testimony to the actual transaction on behalf of both parties, in support of the transaction—even he did not convey his testimony. And the same will be for anyone who was present in that and attested to it. The Prophet ﷺ has held them all as equal in sin because the transaction took place only with their joint efforts. [2]

It is evident from this reference that it is the direct recording of the document of an interest transaction that invokes the curse of Allah and not its subsequent recording or accounting of the facts that already happened. Therefore, the case of an accountant of a firm or a company is different from the person who is directly responsible for the operation of interest transactions.

As far as the source of income or career of the people who are getting their taxes filed by an accountant, that also is unrelated to the accountant. If you are an independent accounting firm, your salary comes from clients for accounting services rendered, which is permissible. You are not required to investigate their origin of income.[3]

If however, you work as an accountant for a company that deals with unlawful transactions or interest then unless the major part of the company is haram it is not prohibited to draw a salary for permissible services rendered to that company.[4] [Please read a similar answer from our previous fatwa: https://fatwa.ca/job-in-a-software-company-whose-main-clients-are-banks/ ]

And Allah Ta’āla Knows Best

Maulana Tameem Ahmadi
Union City, CA.
U.S.A

Checked and Approved by:

Mufti Faisal bin Abdul Hamīd al-Mahmudi
www.fatwa.ca 

 [1] صحيح مسلم ، دار إحياء التراث العربي (3/ 1218) (1597#)
حَدَّثَنَا عُثْمَانُ بْنُ أَبِي شَيْبَةَ، وَإِسْحَاقُ بْنُ إِبْرَاهِيمَ، وَاللَّفْظُ لِعُثْمَانَ، قَالَ إِسْحَاقُ: أَخْبَرَنَا، وَقَالَ عُثْمَانُ: حَدَّثَنَا جَرِيرٌ، عَنْ مُغِيرَةَ، قَالَ: سَأَلَ شِبَاكٌ إِبْرَاهِيمَ، فَحَدَّثَنَا عَنْ عَلْقَمَةَ، عَنْ عَبْدِ اللهِ، قَالَ: «لَعَنَ رَسُولُ اللهِ صَلَّى اللهُ عَلَيْهِ وَسَلَّمَ آكِلَ الرِّبَا وَمُؤْكِلَهُ»، قَالَ: قُلْتُ: وَكَاتِبَهُ، وَشَاهِدَيْهِ؟ قَالَ: «إِنَّمَا نُحَدِّثُ بِمَا سَمِعْنَا»

[2] اكمال الاكمال المعلم للابى ج 4 ص 120
والمراد بالكاتب- كاتب الوثيقة، و بالشاهد-المتحمّل وان لم يؤدِ، و في معناهما مَن حضر و أقرّهما

[3] رد المحتار على الدر: كتاب البيوع، باب المتفرقات، مطلب اذا اكتسب حرامًا ثم اشترى؛ طبعة دار احياء التراث (7/379)
(قَوْلُهُ اكْتَسَبَ حَرَامًا إلَخْ) تَوْضِيحُ الْمَسْأَلَةِ مَا فِي التَّتَارْخَانِيَّة حَيْثُ قَالَ: رَجُلٌ اكْتَسَبَ مَالًا مِنْ حَرَامٍ ثُمَّ اشْتَرَى فَهَذَا عَلَى خَمْسَةِ أَوْجُهٍ: أَمَّا إنْ دَفَعَ تِلْكَ الدَّرَاهِمَ إلَى الْبَائِعِ أَوَّلًا ثُمَّ اشْتَرَى مِنْهُ بِهَا أَوْ اشْتَرَى قَبْلَ الدَّفْعِ بِهَا وَدَفَعَهَا، أَوْ اشْتَرَى قَبْلَ الدَّفْعِ بِهَا وَدَفَعَ غَيْرَهَا، أَوْ اشْتَرَى مُطْلَقًا وَدَفَعَ تِلْكَ الدَّرَاهِمَ، أَوْ اشْتَرَى بِدَرَاهِمَ أُخَرَ وَدَفَعَ تِلْكَ الدَّرَاهِمَ. قَالَ أَبُو نَصْرٍ: يَطِيبُ لَهُ وَلَا يَجِبُ عَلَيْهِ أَنْ يَتَصَدَّقَ إلَّا فِي الْوَجْهِ الْأَوَّلِ، وَإِلَيْهِ ذَهَبَ الْفَقِيهُ أَبُو اللَّيْثِ، لَكِنْ هَذَا خِلَافُ ظَاهِرِ الرِّوَايَةِ فَإِنَّهُ نَصَّ فِي الْجَامِعِ الصَّغِيرِ: إذَا غَصَبَ أَلْفًا فَاشْتَرَى بِهَا جَارِيَةً وَبَاعَهَا بِأَلْفَيْنِ تَصَدَّقَ بِالرِّبْحِ. وَقَالَ الْكَرْخِيُّ: فِي الْوَجْهِ الْأَوَّلِ وَالثَّانِي لَا يَطِيبُ، وَفِي الثَّلَاثِ الْأَخِيرَةِ يَطِيبُ، وَقَالَ أَبُو بَكْرٍ: لَا يَطِيبُ فِي الْكُلِّ، لَكِنْ الْفَتْوَى الْآنَ عَلَى قَوْلِ الْكَرْخِيِّ دَفْعًا لِلْحَرَجِ عَنْ النَّاسِ اهـ. وَفِي الْوَلْوَالِجيَّةِ: وَقَالَ بَعْضُهُمْ: لَا يَطِيبُ فِي الْوُجُوهِ كُلِّهَا وَهُوَ الْمُخْتَارُ، وَلَكِنْ الْفَتْوَى الْيَوْمَ عَلَى قَوْلِ الْكَرْخِيِّ دَفْعًا لِلْحَرَجِ لِكَثْرَةِ الْحَرَامِ اهـ و علّله الزيلعي هناك بأنّ الكافر لا يهتدي من الجائز من العقود… 

الدر المختار شرح تنوير الأبصار: كتاب البيوع، باب البيع الفاسد ؛ طبعة دار الكتب العلمية (2/101)
الْحَرَامُ يَنْتَقِلُ، فَلَوْ دَخَلَ بِأَمَانٍ وَأَخَذَ مَالَ حَرْبِيٍّ بِلَا رِضَاهُ وَأَخْرَجَهُ إلَيْنَا مَلَكَهُ وَصَحَّ بَيْعُهُ، لَكِنْ لَا يَطِيبُ لَهُ وَلَا لِلْمُشْتَرِي مِنْهُ، بِخِلَافِ الْبَيْعِ الْفَاسِدِ فَإِنَّهُ لَا يَطِيبُ لَهُ لِفَسَادِ عَقْدِهِ وَيَطِيبُ لِلْمُشْتَرِي مِنْهُ لِصِحَّةِ عَقْدِهِ. وَفِي حَظْرِ الْأَشْبَاهِ: الْحُرْمَةُ تَتَعَدَّدُ مَعَ الْعِلْمِ بِهَا إلَّا فِي حَقِّ الْوَارِثِ، وَقَيَّدَهُ فِي الظَّهِيرِيَّةِ بِأَنْ لَا يُعْلَمَ أَرْبَابُ الْأَمْوَالِ… 

[4] فقه البيوع على المذاهب الأربعة للمفتي محمد تقي العثماني، طبعة دار القلم: (2/997)
وقد اشتهر على الألسن ان حكم التعامل مع من كان ماله مخلوطًا بالحلال والحرام انه إن كان الحلالفيها اكثر جاز التعامل معه بقبول هديته وتعاقد البيع والشراء معه و بذلك صدرت بعض الفتاوي. لكن ‏ما يتحقق بعد سبر كلام فقهاء الحنفية في هذا الموضوع أن اعتبار الغلبة إنما هو فيما إذا كانالحلال متميزا عن الحرام عند صاحبه ولا يعلم المتعامل معه أن ما يعطيه من الحلال أو من الحرام؛ فحينئذ تعتبر الغلبة بمعنى أنه إن كان أكثر ماله حلالاً يفرض ان ما يعطيه من الحلال، والعكس بالعكس ،كما قدمنا نصوصه وفي الصورة الأولى.أما إذا كان الحلال مخلوطًا بالحرام دون تمييز أحدهما بالآخر فإنه لا عبرة بالغلبة في هذه الحالة فيمذهب الحنفية بل يحلّ الانتفاع من المخلوط بقدر الحلال، سواء أكان الحلال قليلًا أم كثيرًا، يدل على ذلكما يأتي…‏