Many of our frequent website readers have been requesting for long now to write a detailed article on the Zakat, its application and scope and its related calculation.

The purpose of writing this article is to update our users with the basic information of Zakat and its requirement. We have collected different authentic and approved guide to Zakat along with its proper understanding and related calculation.

This guide will provide you with the basic definition of Zakat, its application and the basic elements of Zakat that are considered while calculating Zakat by a Muslim.


Do you know what Zakah/ Zakat exactly means?

When we talk about Zakat, the word Zakah itself carries following two meanings:

S.No. Meanings of Zakah
1 Purification.
2 Growth and Increase.

Do you know the meaning of Zakah/ Zakat rules in the light of Quran and Sunnah?

In the light of the Quran and Sunnah, Zakah is the portion of asset that is made mandatory to be spent in the ways specified by Almighty Allah. Zakat rules


Do you know the two significant benefits of Paying Zakah/ Zakat?

The payer must be aware of the benefits of Zakah, once he come to know its significance, he will be quite motivated to pay Zakah from his wealth on a yearly basis. Those two benefits which we are talking about are discussed below:

S.No. Benefits of Paying Zakah
1 The first benefit is that the payer of Zakah himself gets purified from inner germs of the spiritual diseases.
2

The second benefit of Zakah is that it helps those who are not able to fulfill their needs independently. For e.g. orphans, widows, handicaps, poor people etc.



Quranic Ayat regarding clearning and purifying the wealth

The Almighty Allah says in Surah Taubah:

خُذْ مِنْ أَمْوَالِهِمْ صَدَقَةً تُطَهِّرُهُمْ وَتُزَكِّيهِمْ بِهَا وَصَلِّ عَلَيْهِمْ ۖ إِنَّ صَلَاتَكَ سَكَنٌ لَهُمْ ۗ وَاللَّهُ سَمِيعٌ عَلِيمٌ

Take sadaqah (obligatory alms) out of their wealth through which you may cleanse and purify them, and pray for them. Indeed, your prayer is a source of peace for them. And Allah is (All-) Hearing, (All-) Knowing. (103) At-Taubah 9:103

This verse has explicitly mentioned the first benefit i.e. purification of inner self. The second benefit is not mentioned in this verse. It points to the fact that the real purpose and objective of paying Zakah is the purification of one’s own self, though the second benefit exists in its inference. (Ma’ariful Quran). Zakat rules


Do you know what Quran offers punishment of not giving Zakah?

The Almighty Allah says in Quran that:

وَالَّذِينَ يَكْنِزُونَ الذَّهَبَ وَالْفِضَّةَ وَلَا يُنْفِقُونَهَا فِي سَبِيلِ اللَّهِ فَبَشِّرْهُمْ بِعَذَابٍ أَلِيمٍ

Surah Taubah (Verse 34)

يَوْمَ يُحْمَىٰ عَلَيْهَا فِي نَارِ جَهَنَّمَ فَتُكْوَىٰ بِهَا جِبَاهُهُمْ وَجُنُوبُهُمْ وَظُهُورُهُمْ ۖ هَٰذَا مَا كَنَزْتُمْ لِأَنْفُسِكُمْ فَذُوقُوا مَا كُنْتُمْ تَكْنِزُونَ

Surah Taubah (Verse 35)

As for those who accumulate gold and silver and do not spend it in the way of Allah, give them the ‘good’ news of a painful punishment”(34) on the day it (the wealth) will be heated up in the fire of Jahannam, then their foreheads and their sides and their backs shall be branded with it: “this is what you had accumulated for yourselves. So, taste what you have been accumulating.”(35) At-Tawbah 9:34-35



Do you know what Prophet Muhammad said about non-payers of Zakah?

The Holy Prophet Muhammad (P.B.U.H) has said:

Every nation that does not give Zakah, Allah Ta’ala will
afflict them with a drought.

Another Hadith, narrated Abu Huraira: Allah’s Messenger (PBUH) said,

“The person whom Allah has bestowed with wealth, yet does not give its Zakah, on the Day of Judgment, his wealth will be turned into venomous bald serpent with two black spots over the eyes (or two poisonous glands in its mouth) which will wind around his neck and bite his jaws and say: ‘I am your wealth, I am your treasure.’ “Then the Prophet (PBUH) recited the holy Verse: “Let not those who covetously withhold….”(to the end of the Verse). Sahih Al-Bukhari Hadith 1315 and 4199



Do you know who the payers of Zakah are?

In the light of Islamic teachings, the followings are the payers of Zakah:

S.No. Payer of Zakah
1 Muslim
2 Major (Baligh)
3 Sane
4 Sahib-un-Nisaab (owner of wealth above the level of nisaab).

 

The Above-mentioned four conditions are described respectively in the following lines:

   1. Zakah is obligatory only on the Muslims

Zakah is not obligatory on a non-Muslim as Zakah is an ibadah (an act of pure worship) and a non-Muslim is not obliged to carry out the Ibadah of Islam.

   2. Only those who are classified as Major qualifies to pay Zakah

A person must be major to qualify as a Zakah payer. Minors are not under a fard obligation to perform acts of ibadah such as prayers (salaat) and fasting (saum) because they lack legal capacity. They are accordingly exempt from paying Zakah by reason of absence of legal capacity.


   3. The Zakah payer must be a sane person

 The Zakah payer must be sane. In this regard, two situations must be distinguished:

Case Description
Child who at maturity is insane. In this case, the insane person upon regaining his intellect is exempt from payment of Zakah for the duration of his insanity. Liability for Zakah attaches to him from the time he regains his sanity and accordingly his Zakah year is calculated from such date.
The person although sane at the time of maturity subsequently thereto becomes insane. In this case, if the insanity lasts for a whole year, the insane person is exempt from Zakah for this period, and his Zakah year is therefore deemed to commence from the date of recovery of sanity. On the other hand, if the insanity remains for a part of the year, then he is liable for the Zakah of that year.

What is the Definition of Nisaab?

Nisaab is the threshold or line, which separates those who are duty bound to give Zakah from those who are not. In other words, Nisaab is the minimum amount of wealth whose owner is deemed to be wealthy in the conception of Shari’ah and Zakah is obligatory on him.

For example, one who owns 87.48 grams of gold or 612.36 grams of silver or its equivalent amount of cash or trading assets etc. is called Sahib-un-Nisaab and it is obligatory on him to pay Zakah (i.e. 2.5% of his total zakatable assets) to those who deserve Zakah.


Recipients of Zakah

The Holy Quran has fixed eight categories of recipients in verse 60 of Surah Taubah.

 إِنَّمَا الصَّدَقَاتُ لِلْفُقَرَاءِ وَالْمَسَاكِينِ وَالْعَامِلِينَ عَلَيْهَا وَالْمُؤَلَّفَةِ قُلُوبُهُمْ وَفِي الرِّقَابِ وَالْغَارِمِينَ وَفِي سَبِيلِ اللَّهِ وَابْنِ السَّبِيلِ ۖ فَرِيضَةً مِنَ اللَّهِ ۗ وَاللَّهُ عَلِيمٌ حَكِيمٌ (60

The Sadaqat (prescribed alms) are (meant) only to be given to the poor, the needy, to those employed to collect them, to those whose hearts are to be won, in the cause of the slaves and those encumbered with debt, in the way of Allah and to a wayfarer. This is an obligation prescribed by Allah. Allah is All Knowing, Wise. 

The eight categories of Recipients of Zakah:

S.No. Recipients of Zakah
1 The Poors (Fuqara).
2 The Needy (Masakeen).
3 Collectors of Zakah (Al-‘Aamileen).
4 Those whose hearts are to be won(Al-Mu’allafatu-AlQuloob).
5 The cause of (freeing) the slaves (Ar-Riqaab).
6 Debtors (Gharimeen).
7 The way of Allah (fi Sabilillah).
8 Wayfarer(Ibn-us-sabil).



Some Important rules relating to the recipients of Zakah

S.No. Rules Describe
1 Cash, Trading Assets, Gold & Silver If someone owns cash,equivalent to the value of 613.35 grams of silver, he/she is considered as wealthy in Shari’ah. Hence not eligible to receive Zakah.
2 Cloths or Crockery If one has cloths or crockery that are not used for years but for once or twice, then these cloths or crockery will be considered as an excess of basic necessity. Hence if its value is equivalent or above the value of Nisaab, the owner cannot receive Zakah.
3 House, Household Furniture, Servants, Personal Clothing & Motor Vehicle The house in which one lives & other items all are basic necessities. The owner of all these assets will not be considered as wealthy, no matter how expensive the assets are. Rather he is entitled to receive Zakah if he does not have any Zakatable asset equivalent to the value of Nisaab.
4 House on Rent If a person has given some of his houses on rent and he does not have any assets on which Zakah is levied, he can receive Zakah.
5 Zakat to Minor Child of a Rich  Father Zakah cannot be given to a minor child of a rich person because such minor is deemed to be rich by virtue of the wealth of his father. If the child is major and needy, Zakah may be given to him irrespective of the financial standing of the parents.
6 Zakat to Minor Child of a Rich Mother Zakah can be given to a minor child whose father is not rich but his mother is rich and wealthy because, a minor child is not considered rich by virtue of the wealth of his mother.
7 Poor Wife of a Rich Husband Zakah can be given to a poor woman whose husband is rich.
8 Banu Hashim Zakah cannot be given to the children of Banu Hashim.



Zakatable Assets

Firstly, it is not obligatory to pay Zakah on every asset. Rather only those assets are the subject matter of Zakah that have the potential of growth or increase. These assets may be broadly classified as follows:

S.No. Zakatable Assets
1 Trading assets.
2 Cash & Cash Equivalent (like prize bonds, Travelers Checks etc).
3 Gold and silver.
4 Livestock (goats, sheep, cows and camels).
5 Agricultural output.



General conditions for all Zakatable assets

S.No. Conditions
1 Ownership If someone possesses an asset but does not own it, Zakah is not liable on it.
2 Potential of growth The asset must have the potential of growth as the word Zakah itself means “Growth” or “Increase”.
3 Asset must be in excess of basic necessity The subject matter of Zakah should be other than the basic necessities of a person.
4 One year must elapse over the asset It is necessary that one year elapses over the asset which is subject to Zakah.



Amount of Zakah

The amount of Zakah payable is two and a half percent (2.5%), or 40th portion of:

S.No.
1 The value of gold and silver if it is equivalent to Nisaab or above it.
2 Trading stocks, or its value at the time of obligation of payment of Zakah, if the stock is equal to Nisaab.
3 Sash on hand if equal to Nisaab.



Intention (Niyyah) of Zakah

The intention to give Zakah is a prerequisite for the discharge of the Zakah obligation (as in the case of Salaat and saum). In the absence of such intention (whether due to ignorance or forgetfulness), the Zakah obligation is not discharged 
and the amount paid over to the recipient will deemed to be Nafl sadaqah.

The requirement of an intention to fulfill Zakah is necessary in order to distinguish payment of Zakah from other forms of compulsory and voluntary payments to poor and needy persons.


Zakat/ Zakah Calculator

Assets For Example Put your own values here to calculate your Zakah
Cash in Bank 10,000
Total amount deposited in Banks 20,000
Accounts Receivable 10,000
Rental Income accrued 5,000
Net Asset Value of Bonds 25,000
Total Value of Saving Certificates 30,000
Market Value of Gold & Silver (Total) 40,000
Present value of the property (that is purchased for the purpose of
resale)
100,000
Inventory (Trading Goods) 50,000
Raw Material & Work in Progress 20,000
Finished Goods 30,000
Shares (that are purchased for trade) 40,000
Total Assets
380,000
Liabilities Totals
Total Amount/Accounts/Notes payable 100,000
Unpaid Rentals 10,000
Unpaid Salaries 20,000
Any other Dues(For e.g. Unpaid tax, utility bills etc.) 10,000
Total Liabilities
140,000
Total Assets – Total Liabilities = Net Assets * 2.5% = Zakat Payable 6,000