Key Money

2854. If a person rents a property, and within the rental contract, he puts a condition that after the tenure of the contract is over, he will give the property to him again, and if he wants to give his property on rent to someone else it should be with his permission. Stronger opinion is that this condition is in order. And it is obligatory upon the owner that he should practically act according to the condition made. And if he does not act according to the contract, he has committed a sin. Therefore, if he wants to give the property on rent to someone else, it should be given with the permission and consent of the first tenant, and in this condition, the first tenant can take some money from the owner of the property, and can give the permission to give the property to someone else on rent, or he can take money of someone else and appoint him to take the property on rent. Similarly, at the time of handing over the property for rent, the owner can make an agreement with the tenant that “I will give this property to you on rent, say for two years, for rent money of Hundred thousand dollars and hundred dollars per month, and in addition to what is taken as key money, if it is acted according to the conditions mentioned above, there is not harm. And it is not permissible that the tenant while referring to some non - Shari’ah rules, after the expiry of the contract abstain from clearing the property, and if he does so, he will be a usurper and liable on account of any loss or damage.

2855. If someone pays the key money for a property from an amount for which he has already paid the Khums, if he wants to sell the property at the end of the year, he should consider the profit made on the property as savings and pay the Khums of that amount. And if he has paid the key money for business purpose from the profit he made during the year, it will be considered as the other business profits, and at the end of the year he should evaluate the value of the key money and should pay the Khums; whether or not its value has risen. However, if he has paid the key money to do business in that place, and since the key money is not a tangible asset, and price rise of that place generally is not considered as profit, because he has paid the key money to do business there, until he does not sell it, the Khums will only be obligatory on the amount he paid as key money, and Khums will not be on the risen price. Indeed, whenever he will sell the property, the profit

he will make on it will be considered as the saving of that particular year.