Zakat Calculator

Zakat is one of the important pillars of Islam, which is sometimes referred to as Al-Sadaqa Al-Wajiba (obligatory alms).

Zakat is a pillar of Islam, it is a compulsory act of worship for all Muslims that can afford to give, Zakat can also be referred to as Al-Sadaqa Al-Wajiba (obligatory alms).

• (Zakat is not applicable on non-Muslims).
• Mature (i.e., above the age of puberty)
• Mentally sound (Zakat is not compulsory on those who are insane).
• Free (i.e., not a slave or in prison).
• Complete ownership of the wealth (wealth can only be subject to Zakat if it is in complete ownership of the individual. For example, if someone buried some possessions somewhere and forgot where he had buried them, and then remembered years later, the Zakat will not have to be paid for the interim period when the possessions were missing.)
• One’s wealth should exceed that which is required to fulfil the basic necessities of life.
• One should be free of debt. For example, if someone has £1000 saving, but he also has a debt of £1000, he is not liable to pay the Zakat, so long as his savings do not exceed his debt.
• Zakat is payable on that wealth or property which grows either materially, such as trade goods or free-grazing livestock, or in value, such as gold or silver.
• Total value of wealth and property should be above threshold determined by Shariah.
• Person must have been above Zakat threshold for a whole lunar year. One does not pay Zakat as soon as one reaches threshold; rather a whole lunar year has to pass before one pays the Zakat on the condition that one still above the threshold one year on.

The person who possesses the required threshold which makes Zakat obligatory must give a specific amount of his wealth to those who are eligible to receive Zakat.

• The poor
• The Destitute
• Administrators of Zakat
• To soften the hearts of people
• Those who have been enslaved.
• Those in debt
• Those in the path of Allah
• Travelers (including refugees)

Those assets, wealth, and property upon which it is compulsory to pay Zakat must pass a threshold in order for Zakat to become obligatory on a person. This threshold is known as ‘Nisab’.

It is not compulsory upon you, i.e., on gold, until you are in possession of 20 dinars. When you have 20 dinars and a whole year passes, then half a dinar becomes obligatory on it, and whatever exceeds it, then it is in accordance to the excess (i.e., 1/40) [Abu Dawud, #1573].

There is no Zakat upon any silver that is less than five awqiya (612.36 grams) [Bukhari, #1390].

If these valuable stones and jewels [i.e., other than gold and silver] are for the purpose of trading, then they are liable for Zakat. If however, they are used for one’s personal use, Zakat does not need to be paid on it, irrespective of its value.

Yes, in order to fulfil one’s obligation, one must intend (i.e., specify) that they are paying Zakat. As an act of worship pertaining to financial dealings, an intention is required in order for it to be performed correctly. The intention (niyya) for fulfilling one’s obligation is to intend that one is paying Zakat, whether that be at time of distributing one’s wealth to those who are eligible (i.e., at the time of payment), or when setting Zakat money aside.

Yes, someone who is legally responsible to pay Zakat can pay through monthly instalments throughout the year, with the intention of paying Zakat. When lunar year comes to an end, Zakat should be calculated, and whatever remains outstanding should be paid off. In similar fashion, outstanding amount can also be paid through instalment.

Yes, it can be done, however, it is best to pay the Zakat on time. If the Zakat of the previous year is outstanding, then it can be paid together with the Zakat of the current year.

`Ali b. Abi Talib narrates that `Abbas asked the Holy Prophet [SAW], ‘Can the Zakat be paid before its time?’ The Holy Prophet [SAW] permitted him to do this [Abu Dawud #1624].

The obligation of paying the Zakat of that year will be dropped. That is, one will be forgiven for the amount which is lost or misappropriated.

Whether the shares are bought on a profit/loss basis or for capital gain, in both cases the Zakat will be calculated using the current market value of the shares. The purchase value of the shares will not be taken into consideration, regardless whether at the time of calculating the Zakat the value of the shares increased or decreased in value from its purchase price.

It is obligatory to pay the Zakat upon four types of assets:

• Gold, silver, and cash.

• Livestock, such as camels, cows, and goats, etc.

• All kinds of trade goods and merchandise (including property bought with the intention of re-sale).

• Those products that are produced from the land such as fruit, vegetables, and minerals, etc.

It is not a condition of Zakat and sadaqa that it is paid only in the month of Ramadan; however, it is the most recommended time to pay it. It is obligatory (wajib) to pay the Zakat as soon as the lunar year has passed, and its payment should not be deferred till the month of Ramadan. However, if Ramadan is drawing near, such as the Zakat is due in Sha`ban, then there is no harm in waiting till Ramadan to pay it. If however the year comes to an end in Muharram, one should not wait till Ramadan to pay it; rather it should be paid at the first instance. If someone wants to pay the Zakat in Ramadan, then the way of doing this would be to pay the Zakat in advance before the year is complete (i.e., the Ramadan prior to Muharram). It is not permitted to delay the payment of one’s Zakat after its due date.

Being in complete ownership of one’s possessions is a precondition of Zakat. Before a woman decides whether the payment of Zakat is obligatory on her dowry, she should first ensure whether she is in full ownership of it. If the dowry is not in her full ownership, then she is not obligated to pay Zakat on it.

Between the husband and wife, whoever is in real ownership of the jewellery will be liable to pay the Zakat. If the husband has given the jewellery to his wife simply for safekeeping, in that he can sell or dispose of them the way he wants, then in that case the Zakat will not be due upon the wife, as it will be the husband’s responsibility. However, if the wife owns the jewellery and the discretion is hers to either wear or sell them, then she will be responsible to pay the Zakat.

No, a husband and wife cannot give their Zakat to each other.

A person who is in debt should put aside the money he or she owes (to pay back the debtor). Whatever money or asset is leftover, if it reaches the nisab, the Zakat becomes obligatory; but if it does not reach the nisab, then the Zakat does not need to be paid.

Yes, if one in debt is poor and is not obligated to pay Zakat, then no doubt Zakat money can be used to clear his debt. However, if person in debt is wealthy and qualifies to pay Zakat, then it is not permitted for him to take Zakat money to pay off his debt. In the former case, where the person is eligible to receive Zakat, debtor do not need to mention that he is using Zakat money to cancel his debt; he simply needs to let him know that he is no longer liable to pay back the loan, so that his dignity and honour is not hurt.

After fulfilling one’s basic needs, if there is cash and other assets leftover, the Zakat will still be obligated on the person, even if the person does not own gold or silver. The reason for this is that gold and silver were used as currency in the time of the Holy Prophet [SAW]. Today, paper currency has replaced gold and silver, so paying Zakat upon all currency alongside silver and gold is obligatory.

The method of calculating Zakat is that any surplus cash that remains after fulfilling one’s basic needs that reaches the level of nisab (i.e., 612.36 grams of silver), has been held for a year, and there is no debt to pay off, then Zakat must be paid by giving 2.5% of that wealth

According to Imam Abu Hanifa,

one that is more beneficial to poor should be used as the nisab [Kasani 2:21]. Imam Marghinani, in al-Hidaya [1:105], states regarding this statement of Imam Abu Hanifa:

As a measure of caution one from either of gold or silver should be used that will better provide for the needs of the poor and destitute.

It is also the dominant opinion that silver can be added to gold, or vice versa, in order to reach the nisab amount. Trade goods and merchandise can also be added for this purpose. This is the view of the majority and it is supported by the following hadith related by Bukayr b. `Abd Allah Ashaj:

It was the practice of the Companions of the Holy Prophet [SAW] that gold was merged with silver, and silver with gold, in order to pay the Zakat [Kasani 2:19].

Zakat is obligatory (fard) on any currency that reaches the amount determined as the nisab. The jurists have given the following conditions for the obligation of Zakat on paper currency:

1. Currency should have reached amount of nisab.

2. A whole lunar year must have passed.

3. There is no debt to pay off.

4. The cash that one has in his possession is excess of his basic needs such as his day-to-day expenditures, e.g., clothing, food and accommodation.

Zakat is not due on houses, flats, or lands which are used as one’s personal accommodation. However, if one rents a house, flat, or shop for the purpose of making profit, then the Zakat is due on the annual net earnings. If the annual profit from all the means of income reaches the nisab amount, then Zakat must be paid on it.

Zakat must also be paid on the value of one’s house, flat, or land which was bought originally with the purpose of re-sale (i.e., for business or trade purposes). The Zakat should be paid on the current market value, and not the purchase price. This is a point to be considered by those investing in land or property.

The tenant must pay the Zakat on the deposits which he or she pays as guarantee for renting a property. Likewise, the Zakat of security deposits that are paid by traders and agencies to firms or organisations that is returnable must be paid by the depositor.

Zakat is compulsory on trade goods and merchandises (i.e., items which are bought with the intention of re-sale), but not on tools or equipment used in trade or business. Equipment and tools which are used for one’s business and trade are a means of one’s income, and the means of income have been declared as exempt from Zakat by the Shariah. However, the profit gained by their use, if it reaches the nisab and a year has passed, it becomes compulsory to pay the Zakat on this.

Whether the shares are bought on a profit/loss basis or for capital gain, in both cases the Zakat will be calculated using the current market value of the shares. The purchase value of the shares will not be taken into consideration, regardless whether at the time of calculating the Zakat the value of the shares increased or decreased in value from its purchase price.

In a business partnership, each partner will pay the Zakat in accordance with his share of the business. For example, if two people are equal partners in a business, then at the end of the year they will pay the Zakat on half of the value of the business. It is narrated by Anas that Abu Bakr al-Siddiq writes with regards to this ruling,

Any assets that are shared, they should be worked out proportionally [Bukhari #1383].

You must pay zakat with the intention of paying it. It is important that you make an intention to give a donation as a zakat payment.

Zakat is to be paid on the total savings regardless of what was paid on it in the past. Therefore, you would pay 2.5% of 10,000, 250.

The length of time that an individual must possess the wealth that they will pay zakat on.

Yes, they can pay Zakat, but they would need to factor in any expenditures or liabilities when calculating how much they would need to pay.

It sounds as if the mentioned fund would count as a Waqf. The general rule is that a Waqt is not liable for Zakat. As long as, there is no personal ownership, or nobody is personally benefitting from this fund, and also depending on the nature of the fund, Zakat may/may not be liable. However, you would need to check this with a scholar.

The Fuqara & the Masakin. Fuqara are those that do not own wealth to the amount of Nisab. Masakin are those who do not have food for the day (15-20% of the world).

We have delivery offices in the countries in which we work, and they carry out assessment – using selection criteria – because we want to ensure that we are reaching the most vulnerable people.

It can only be given to people from one of these seven categories. Most scholars agree that you can give zakat to a family member if they’re from one of the categories. E.g. they are poor and unable to provide for themselves, and is not already dependent on you. But if he/she is one of your dependents, you are obliged to spend on them anyway and cannot give them anything from your Zakat.

If the orphan is eligible to receive zakat (E.g they or their family own less than the nisba or do not have food for the day) then they will be eligible to receive it. Orphans would come under category 1 and 2 recipients of Zakat.

We spend Zakat funds on projects where we can guarantee that the recipients are poor and needy and directly receive the assistance. So, for example, we can provide food packs to destitute people so they can feed themselves and their families.  But we would not use the funds on a well that would benefit the whole community. This is because we could not guarantee that only poor and needy people will get water from that well. However, we will use other funds such as Sadaqah to pay for projects that benefit whole communities.