The meaning of the idea that Allah is in heaven is that He is above the heaven

With regard to the issue of Allah being above His creation and rising above His Throne, there are two important principles which must be established and highlighted: 

1.

Affirming that which Allah has affirmed for Himself in His holy Book, in which He describes Himself as being above all of His creation, and rising above His Throne after creating the heavens and earth. This is stated in clear and unambiguous verses of the Quran. Allah says (interpretation of the meaning):

“And to Allah prostrate all that is in the heavens and all that is in the earth, of the moving (living) creatures and the angels, and they are not proud [i.e. they worship their Lord (Allah) with humility].

50. They fear their Lord above them, and they do what they are commanded”

[al-Nahl 16:49-50]

“Do you feel secure that He, Who is over the heaven (Allah), will not cause the earth to sink with you, and then it should quake?

17. Or do you feel secure that He, Who is over the heaven (Allah), will not send against you a violent whirlwind? Then you shall know how (terrible) has been My Warning”

[al-Mulk 67:16-17]

And the Prophet (blessings and peace of Allah be upon him) said: “Do you not trust me, when I am the trustee of the One Who is above the heaven and the news of heaven comes to me morning and evening?” Narrated by al-Bukhaari (4351) and Muslim (1064). And he also said: “Show mercy to those who are on earth so that the One Who is in heaven will show mercy to you.” Narrated by al-Tirmidhi (no. 1924) – he said it is hasan saheeh. And he also said: “When Allah created the universe, he wrote in His Book, which is with Him above the Throne: “My mercy prevails over My wrath.” Narrated by al-Bukhaari (3194) and Muslim (2751). 

See also the answers to questions no. 992, 9564, 11035 and 47048. 

2.

Nothing of Allah's creation can encompass Him and He is not contained within His creation. He, may He be glorified, has no need of it. He is above needing it and exalted be He above any of His creation encompassing Him.  

Allah says (interpretation of the meaning): 

“No vision can grasp Him, but He grasps all vision. He is Al-Lateef (the Most Subtle and Courteous), Well‑Acquainted with all things”

[al-An’aam 6:103]

“He (Allah) knows what happens to them (His creatures) in this world, and what will happen to them (in the Hereafter) but they will never compass anything of His Knowledge”

[Ta-Ha 20:110]

From these two principles, Ahl al-Sunnah established that the idea of Allah’s being above His Throne and above all of His creation means that He is above all creation, above the heaven, above Paradise, above the Throne, and none of His creation encompasses Him, He does not need any of them; rather He is their Creator and Sustainer. The texts which describe Allah as being in heaven mean that He is high above His creation: they do not mean that the heaven surrounds and encompasses Him. That is because heaven [sama’] here means high, and it is not referring to the created heaven. Or it may be said that the proposition in [fi] in this case means above [‘ala], i.e., above the heaven. 

It is proven that ‘Ali ibn al-Hasan ibn Shaqeeq, the shaykh of al-Bukhaari, said: 

I said to ‘Abd-Allah ibn al-Mubaarak: How do we know our Lord?

He said: [He is] in the seventh heaven above His Throne. According to another version: [He is] above the seventh heaven above His Throne, and we do not say as the Jahamiyyah do, that He is here on earth. 

That was said to Ahmad ibn Hanbal, and he said: This is how we understand it. 

Imam al-Dhahabi said, commenting on this report:

This is saheeh and proven from Thaabit ibn al-Mubaarak and Ahmad (may Allah be pleased with them both). The words ‘in heaven’ in another report explain to you that what he meant by saying ‘in heaven’ was ‘above the heaven’, as in the other saheeh report which he wrote to Yahya ibn Mansoor al-Faqeeh. End quote. 

Al-‘Arsh 2/189 

We will quote here the words of the scholars which explained and clarified this matter: 

Al-Haafiz Ibn ‘Abd al-Barr (may Allah have mercy on him) said: 

With regard to the words of Allah (interpretation of the meaning): “Do you feel secure that He, Who is over the heaven [fi’l-sama’] (Allah), will not cause the earth to sink with you, and then it should quake” [al-Mulk 67:16], what it means is the One Who is above the heaven, i.e., above the Throne. The word fi [in the phrase fi’l-sama’ (translated above as ‘over the heaven’); fi literally means ‘in’] may mean ‘ala [above, over]. Haven’t you seen the verse in which Allah says (interpretation of the meaning): “So travel freely (O Mushrikoon) for four months (as you will) throughout the land [fi’l-ard]” [al-Tawbah 9:2], meaning on the land; and the verse in which He says (interpretation of the meaning): “and I will surely, crucify you on the trunks of date palms [fi judhoo’ al-nakhl]” [Ta-Ha 20:71]. End quote. 

Al-Tamheed, 7/130 

Shaykh al-Islam Ibn Taymiyah (may Allah have mercy on him) said: 

The salaf, the imams and all the scholars of the Sunnah, when they say that He is above the Throne, He is in heaven above all things, do not mean that there is something which contains Him or surrounds Him, or that He has a location, or that there is something that encompasses Him. Exalted be He above that. Rather He is above all things, He has no need of all things, and all things are in need of Him. He is above all things, He is the One Who carries the Throne and its bearers by His power and might. All created beings are in need of Him, but He has no need of the Throne or of any created being. 

With regard to what it says in the Quran and Sunnah, “Do you feel secure that He, Who is over the heaven [fi’l-sama’]…?” [al-Mulk 67:16] and so on, some people may understand the word heaven as being the same as the created heaven on high or the Throne and what is beneath it, so they say that His words “in heaven (fi’l-sama’)” mean that He is above the heaven, as the words “and I will surely, crucify you on the trunks of date palms [fi judhoo’ al-nakhl]” [Ta-Ha 20:71] mean on the trunks of date palms, and the words “So travel freely (O Mushrikoon — see V.2:105) for four months (as you will) throughout the land[ fi’l-ard]” [al-Tawbah 9:2] mean on the land. 

There is no need for that; rather the word sama’ (often translated as heaven) refers to what is up high, and does not apply to any specific thing. So the words fi’l-sama’ [translated above as ‘in heaven’] apply to that which is up high as opposed to being low or down. 

He is high and the highest, and He is the Highest of the high; there is nothing beyond the Most High, may He be glorified and exalted. End quote. 

Majmoo’ al-Fataawa (16/100-101) 

To sum up: What you believe, that Allah rose above His Throne, above His heaven, above all of His creation, is what every believer must believe. What you have read in the Tafseers referred to, that Allah is ‘in heaven’ is also correct and is in accordance with what you believe. It is mentioned in the Quran and Sunnah, but on condition that it be understood that the word heaven (sama’) here means what is on high, above, or that fi [in] may mean ‘ala [above], as we have explained above. If the mufassir intended some meaning other than that which we have mentioned, then his words are to be rejected. We would appreciate it if you could tell us exactly what he said so that we may examine what is in it. 

And Allah knows best.