I’m new to stock investing and I would like to understand in sha Allah the reasoning behind the % number cap for interests bearing debt? In regards to haram income, let’s say strictly from interests, the maximum tolerable amount is 5%; that’s interests going in. Why would interests on debt (interests going out or being paid out) considerably higher? Isn’t interest equally bad receiving and paying? That’s the first part of my question.
Secondly, why is there only mention of purification for the 5% (interests going in) and not the 33% (interests going out / paid out)? Again, what makes one different from one another?
I have a follow-up question on how to deal with a stock that was compliant at the time of purchase and now has become non-compliant as the gearing has breached the 30% criteria (talking of carnival and easy jet precisely)
Do these need to be sold immediately?
What happens to the capital gain? purify a portion or all needs to go to charity?
I also wonder that when there is interest income coming to the company (5% cap), we purify the dividends, how do we deal with the non-compliance resulting from 30% loan situation in regards to Capital gain which will result not from companies future potential of earning interest income but due to recommencing of operations as we come out of COVID.