Estate planning holds significant importance for every individual, but for Muslims in Singapore, it takes on a distinctive form due to the application of Faraid, an Islamic law on inheritance. Unlike non-Muslims, Muslims must adhere to specific rules and regulations that govern the distribution of their estate after death.
Faraid Distribution
Faraid represents the Islamic legal framework concerning inheritance, establishing the guidelines for asset allocation among heirs. The beneficiaries in this system are contingent upon the familial structure.
An illustrative facet of Faraid pertains to the shares allocated to different heirs. For instance, a son may receive twice the inheritance of a daughter. In scenarios where conventional male heirs like sons or uncles are absent, a segment of the estate is earmarked for the community entity known as Baitulmal.
Integral to comprehending Faraid is the concept of a Wali, a male figure appointed to oversee the welfare of younger female family members. This dynamic is nuanced; if there is a son, uncles are excluded from inheriting. Conversely, in situations with only daughters, uncles may be eligible for a share.
- In contrast to non-Muslim families, adopted children do not automatically qualify as beneficiaries under Faraid. Their inclusion necessitates explicit mention in the will to secure rightful inheritance.
- Regarding children born out of lawful Islamic marriages, a distinctive rule applies. While such children can inherit from their mothers, paternal inheritance is precluded.
- The status of non-Muslims in Faraid is notable; by default, they are not considered beneficiaries in the absence of a valid Will.
Other Estate Planning Tools
Muslims can use additional estate planning tools during their lifetime. Joint tenancy, Hibah (gifts made while alive), and trusts offer viable options to ensure the smooth transfer of assets, tax optimisation, and protection of loved ones’ interests.
Understanding the unique implications of estate planning for Muslims in Singapore is crucial for ensuring a fair and just distribution of assets in accordance with Islamic principles. Planning ahead and utilising available tools can ease the process, providing peace of mind for individuals and their families.
Disclaimer:
This article should not serve as a substitute for independent professional advice. Contact Summit Planners to schedule a consultation with our team of professionals.
Sources:
- http://estateplanning.com.sg/life-stages/you-are-a-muslim/
- https://www.propertyguru.com.sg/property-guides/estate-planning-muslim-homeowners-57738
- https://syariahcourt.gov.sg/Inheritance/Overview
