Shaykh Uthaymīn says in one of his fatwas: “The carved image out of wood or rock, or made from clay or dough, or anything resembling them, all of them are harām if they are in the form of an animal having a spirit.”

Based on this, which are the animals that have a spirit? I was under the impression that only humans have spirits and that all animals will be turned to dust on the Day of Judgment, but according to the statement of Shaykh Uthaymīn, there seem to be two types of animals – one with spirit and one without. Kindly explain.

In addition, would it then be allowed to carve images of animals without spirit?

The spirit of life or an animal soul is found in all living creatures. The details of it are known to Allah.

All animals have life and the presence of the spirit. The fact that they will become dust on the Day of Judgment doesn't change the fact that they have an animal spirit or soul. It is like jinn having spirit/soul, but it not like the human spirit and soul; similarly in the case of animals.

A related fatwa that alludes to the fact that animals have souls: http://islamqa.info/en/119652

A fatwa related to sculpting: http://islamqa.info/en/98533