Question:
How is zakat calculated? On what things is zakat compulsory? Jazakallahu Khairan. Answer:In the Name of Allah, the Most Gracious, the Most Merciful.
In order to know how to calculate zakat, one must firstly know the
meaning of "zakat day" and "zakatable assets". §
"Zakat day": A person's "zakat
day" is that day of the year according to the Arabic (Hijri)
calendar in which he first became the owner of nisab
after becoming mature (i.e. after reaching the age of puberty). (Nisab is the value of 612.35 grams of silver.
Currently (in August 2012), this is equal to approximately $530 AUD). For example,
if the first time you became the owner of nisab
was on the 20th of Sha'ban, then your "zakat day" will be
the 20th of Sha'ban every year. §
"Zakatable assets": Zakatable assets are the
following assets: o cash o gold o silver o merchandise
(i.e. anything bought with the intention of resale) After understanding the above, one should then know that it is
compulsory to pay zakat every year at the rate of 2.5% of the total value of
the "zakatable assets" that one owns on his "zakat day". In
other words, when one's "zakat day" comes, he should calculate the
total value of his "zakatable assets". If this (total value of his
"zakatable assets" on his "zakat day") is equal to or more
than the nisab, he should give 2.5% of that in
zakat. On the other hand, if it (total value of his "zakatable
assets" on his "zakat day") is less than the nisab,
he does not have to pay zakat. For example, if your "zakat day" is the 20th of
Sha'ban, then every year on the 20th of Sha'ban, calculate the total
value of your "zakatable assets"; thereafter, you must give 2.5% of
that in zakat. Hence, if this year on the 20th of Sha'ban the total
value of your "zakatable assets" was $10,000, then you must give $250
in zakat this year. If next year on 20th of Sha'ban the total value
of your zakatable assets is $20,000, then you must
give $500 in zakat next year. It does not matter how much "zakatable assets" you own before
or after your "zakat day". For example, two days before your
"zakat day" you owned $15,000, but on your "zakat day" you
only owned $10,000, then you will have to give zakat on $10,000, not $15,000. It does not matter how long one has had a particular "zakatable
asset" for. If he owns it on his "zakat day", he will have to
pay zakat on it. For example, on his "zakat day", someone has some
gold or some cash that he acquired only one day ago. He will still have to pay
zakat on them. If a person is in debt, then he should deduct the amount that he owes from
the total value of his "zakatable assets" in order to calculate
zakat. For example, the total value of your "zakatable assets" is
$10,000 on your "zakat day". However, you owe someone $2,000. You
will have to pay zakat on $8,000, not $10,000. Note: For long term loans,
only deduct the amount that is payable within one year from your "zakat
day". If the total value of one's "zakatable assets" on his
"zakat day" is less than the nisab,
he will not have to pay zakat. If a person bought something with the intention of resale, it will be
considered merchandise and zakat will be compulsory on it. If someone bought
something for personal use and later on he decided to sell it, zakat will not
be compulsory on it. When evaluating gold, silver and merchandise for calculating zakat, one
should look at their selling price (i.e. the price they could be sold for) on
his "zakat day". One should not look at how much he bought them for. Summary: In summary, the formula for calculating zakat is: Amount of Cash + value of gold + value of silver + value of merchandise – debt owed to someone X 0.025 For example, on his "zakat day", Zaid
had the following "zakatable assets": Cash: $5000 Gold valued at: $3000 Silver valued at: $1000 Merchandise valued at: $2000 At the same time, he owed someone $2500 Zaid will calculate the
zakat amount that is due on him thus: 5000 (cash) + 3000 (value of gold) + 1000 (value of silver) + 2000 (value of merchandise) – 2500 (amount he owes someone) = 8500 (This is the amount
that zakat is payable on) ----------- = 212.50 (This is the amount
that Zaid needs to pay as zakat) ====== Hopefully, the above has clarified the basics of zakat. |
Mufti-Online.net answers issues pertaining to Shariah. Thereafter, these questions and answers are placed for public view on www.mufti-online.net for educational purposes. However, many of these answers are unique to a particular scenario and cannot be taken as a basis to establish a ruling in another situation or another environment. Mufti-Online.net bears no responsibility with regards to these questions being used out of their intended context.
- The Shariah ruling herein given is based specifically on the question posed and should be read in conjunction with the question.
- Mufti-Online.net bears no responsibility to any party who may or may not act on this answer and is being hereby exempted from loss or damage howsoever caused.
- This answer may not be used as evidence in any Court of Law without prior written consent of Mufti-Online.net.
- Any or all links provided in our emails, answers and articles are restricted to the specific material being cited. Such referencing should not be taken as an endorsement of other contents of that website.