Knowledge Bank

All your Zakat questions answered
Zakat FAQ

Frequently Asked Questions

01. What is the purpose of Zakat?

Islam primarily describes a state of subservience, along with a core set of beliefs and instituted acts.

The Prophet (may Allah’s salutations and peace be upon him) stated that Islam, that is the same state of subservience, is built on five distinctive acts:

1. Testifying that there is no god but God and that Muhammad is the messenger of God,
2. Maintaining Salat,
3. Giving the Zakat,
4. Fasting in Ramadan,
5. The pilgrimage to the House – for those who are able to find a way.

Being built on suggests a number of things; that these five things form the basis of true subservience to God, and in being a basis it follows that everything else in the faith follows on from them, rather than there being other aspects of the faith sitting alongside them, and thus of equal elemental disposition.

Looking at it this way, these five distinctive acts do not merely engender a ritual disposition but offer a robust course of development that founds the most fundamental aspects of complete subservience. Thus, when these foundations are implemented individually and collectively as institutions, it paves the way for Islam to flourish in the lives of those in society, resulting in a society committed to God.

02. How to calculate the Zakat within the couple?

Here are some elements to take into account:

When it comes to calculating and paying Zakat within the couple, it is not always easy to distinguish who owns what. To make the calculation easier, here are some guidelines:

1. First of all, it is important to know that zakat is a personal duty, which de facto implies that the man and the woman must calculate their zakat separately. Since zakat is a personal responsibility, it is up to each individual to make his or her own calculation of zakat.

2. When the amount to be paid is calculated (see our zakat calculator), each person can pay his or her zakat himself or herself. The man or woman can make the payment for both, this is equally valid.

3. If the couple uses a joint account, and it is difficult to distinguish who owns what, then we advice to divide the amount in this account by 2 and include this amount in each person’s separate calculation.

4. It is quite possible and normal for one person to be eligible to pay zakat (as it is above the Nisab) and the other not (as it is below it). There is no problem with this.

If you have any questions, please do not hesitate to contact us via our contact section. Our team will answer you as soon as possible.

Your SZF team

03. Which asset is Zakatable?

An asset must fulfil the following criteria to qualify as a Zakatable asset:

1) Complete ownership of the asset

2) The asset is productive (intrinsically or extrinsically)

3) The wealth is equivalent to Nisab or more

4) A whole lunar year passes after possessing Nisab

Complete ownership of wealth:

Complete ownership refers to having ownership and the ability to benefit from a Zakatable asset. It is not necessary to have direct possession; one may have indirect possession such as having cash deposited in the bank or money kept with a relative. This is agreed upon by the mainstream schools of jurisprudence.

Asset is productive:

Zakat is binding on wealth which is productive according to all four schools of jurisprudence.

Productivity in terms of Zakat refers to the potential of an asset to grow and increase. Productivity of an asset can be intrinsic as is the case with gold, silver and cash. Productivity can be activated by an intention to trade when purchasing stock or investing into Zakatable assets. And finally, productivity can be established through the breeding of flock.

Besides these three causes, the Shariah has not recognised any other cause of productivity. Personal assets and belongings which may appreciate will not be Zakatable despite growing in value as they are not productive wealth in Zakat terms.

The wealth is equivalent to Nisab or more:

For the payment of Zakat to be obligatory, it must equal or exceed the Nisab threshold on the Zakat anniversary.

A whole lunar year passes after possessing Nisab:

After owning Nisab for the first time, Zakat is obligatory after the passing of one lunar year. Thereafter, Zakat will be due every year on the same date if the qualifying conditions are found. It is not necessary for a year to pass on every single Zakatable asset, rather, the same Zakat anniversary will be used for other Zakatable assets such as gold, silver, cash and business stock acquired during the year.

04. Is Zakat obligatory on children?

According to the Hanafi school, Zakat is not obligatory on children who are not mature.

According to the Maliki, Shafi’I and Hanbali schools, Zakat is obligatory on the wealth of children.

05. When is Zakat obligatory to pay?

Just like Salat, Fasting and Hajj have conditions before they become obligatory, Zakat also has conditions before it becomes compulsory.

Zakat is only obligatory when certain conditions are met. There are two sets of conditions:
1) conditions relating to wealth
2) conditions relating to the Zakat payer

06. Who is liable to pay Zakat?

Whoever has the following three characteristics qualifies to pay Zakat : 1) Adolescent
2) Muslim
3) Sane Adolescence (have reached the age of puberty)

In Islam, mature individuals are obliged to perform the compulsory forms of worship such as Ṣalāt, Zakat, Fasting and Ḥajj. Islam considers adolescents as mature. A person is adolescent when experiencing puberty. The following are some indications of puberty :
1) Experiencing a wet dream
2) Menstruation
3) Reaching fifteen lunar years in age (approximately 14 years and 7 months)

Muslim Zakat is an action of worship and it is only obliged on those who have faith in Islam. Faith in Islam is a primary condition for the requirement of all forms of worship.

Sane According to all jurists, a sane person qualifies to pay Zakat if other conditions are found. A sane person is one who has mental capacity.
Differences of opinion: • The orphan • The child (pre-puberty) • The mad / insane.

The three schools of jurisprudence other than the Hanafi school state that Zakat should be paid on qualifying wealth owned by the orphan, child and the insane.

The three schools of jurisprudence consider the ownership of wealth reaching the Nisab as the driving factor behind the Zakat obligation.

Furthermore, the child, insane and orphan’s wealth will also benefit from the purification of wealth due to the payment of Zakat. The Hanafi school considers the element of worship in Zakat and therefore opines that Zakat is not binding on the orphan, child and insane.

Since these individuals are not obliged to perform worship, they are not obliged to pay Zakat. However, if a person has intermittent sanity, they will be required to pay Zakat. Only a person with continuous insanity and mental incapacity is exempt from Zakat.

The parent/guardian will be responsible to pay Zakat on the wealth of the orphan, child and insane. They can pay from the wealth of these individuals.

07. What are the benefits of paying Zakat which are mentioned in the Qur’an?

Paying Zakat has been associated to several physical and metaphysical benefits in the Quran. Some of them are as follows:

1) The means to attain Allah’s mercy “My Mercy extends to all things. That (Mercy) I shall ordain for those who have God-consciousness and give their Zakat and those who believe in Our Signs.” (Sūrah Al-A`rāf 7:156).

2) A precondition to obtain Allah’s help “Allah will certainly aid those who aid His (cause); for verily Allah is Full of Strength, Exalted in Might, (able to enforce His Will). (They are) those who, if We establish them in the land, establish regular prayer and give their Zakat, enjoin the right and forbid wrong: with Allah rests the outcome of all affairs.” (Sūrah Al-Ḥajj 22:40-41).

3) A sign of brotherhood in religion “But (even so), if they repent, establish regular prayers, and give their Zakat, they are your brethren in Faith.” (Sūrah Al-Taubah 9:11).

4) A distinctive feature of the faithful community “The Believers, men and women, are protectors one of another: they enjoin what is just and forbid what is evil: they observe regular prayers, pay their Zakat and obey Allah and His Messenger. On them will Allah pour His Mercy: for Allah is Exalted in power, Wise.” (Sūrah Al-Taubah 9:71).

5) A distinctive quality of the believers who go to and maintain mosques “The mosques of Allah shall be visited and maintained by such as believe in Allah and the Last Day, establish regular prayers, and pay their Zakat and fear none (at all) except Allah.” (Sūrah Al-Taubah 9:18).

6) A distinctive quality of the true believers: “Who are active in paying Zakat.” (Sūrah Al-Mu’minūn 23:4). And as important as Ṣalāh “And establish the prayer and pay the Zakat and bow (in prayer) with those who bow.” (Al-Baqarah: 43)

08. Are there any worldly harms mentioned for not paying Zakat?

Abdullah Ibn ‘Umar (May Allah be pleased with them) said: “No people refuse to pay the Zakat of their wealth, except they will be denied of receiving rain drops from the sky. Had there not been for the animals, they would never receive rain.” (Sunan Ibn Majah)

This Hadith indicates to the relationship between actions and conditions we face. Non-payment of Zakat, which is disobedience to Allah in Islam, has direct and indirect consequences on the natural environment.

Allah has decreed balance and equilibrium in His creation and when this balance is disturbed, the natural order in the creation is interrupted.

The types of actions or the non-action of the human being, both individually and collectively, personally and spiritually, has the potential to breed adverse results in the physical space we inhabit.

09. What is Zakat?

Zakat literally means blessing, growth, cleanliness and betterment .The word Zakat originates from the Arabic verb zaka’, meaning to grow, to increase and to purify.

When said about a person, it means to improve or to become better. In Islamic law, the word Zakat refers to the determined share of wealth prescribed by Allah to be distributed among the deserving categories of recipients.

10. What does the word ‘Zakat’ mean?

The word Zakat originates from the Arabic verb zaka, meaning to grow, to increase and to purify.

When said about a person, it means to improve or to become better. In Islamic law, the word Zakat refers to the determined share of wealth prescribed by Allah to be distributed among the deserving categories of recipients .

11. How many times is Zakat mentioned in the Qur’an?

The word Zakat is mentioned thirty-two times in the Quran; Thirty from the thirty-two are in the technical meaning of Zakat whilst two are in the linguistic meaning of Zakat. The two places are:

1) Sūrah al-Kahf (The Chapter of The Cave), verse 81
2) Sūrah Maryam (The Chapter of Mary), verse 13

12. Is Zakat obligatory on someone who lacks mental capacity?

According to all jurists, a sane person qualifies to pay Zakat if other conditions are found. A sane person is one who has mental capacity.

According to the Hanafi school, Zakat is not obligatory on an individual who lacks mental capacity.

According to the majority of scholars, Zakat is obligatory on the wealth of those who lack mental capacity.

The Hanafi school are of the view that a person with continuous insanity and mental incapacity is exempt from Zakat. However, a person with intermittent sanity is still required to pay Zakat

13. 10 Differences Between Zakat and Sadaqah

Zakat and Sadaqah are forms of worship done by Muslims. The two are different in their own respects.

The word Sadaqah is derived from the Arabic word Sidq (truth). All actions of righteousness in Islam is considered as Sadaqah. Zakat on the other hand, is one of five fundamental foundations of Islam. This makes it a compulsory act, and therefore, all Muslims must give Zakat, provided they meet certain conditions, while Sadaqah is an intended and continuous act of uprightness, which everyone has to carry out no matter what their ability.

Here are 10 key differences between Zakat and Sadaqah, understanding them is crucial as each has its own purpose.

  1. Zakat is obligatory once a year whilst Sadaqah is never obligatory
  2. Zakat is paid on specific assets such as: gold, silver, cash, business assets, agricultural produce, livestock, treasure troves whereas Sadaqah has no such specification in terms of assets.
  3. Certain liabilities can be deducted from a Zakat calculation whereas Sadaqah has no calculation in which liabilities are deducted.
  4. Zakat was collected and distributed by the Islamic government whereas Sadaqah is always a personal act of kindness.
  5. According to some schools of law, Zakat can be forcefully taken. The state can take punitive measures on the non-payers of Zakat. Whereas, Sadaqah is never enforced upon people.
  6. Abandoning Zakat payments is tantamount to a type of treason whereas not giving Sadaqah is not sinful.
  7. Zakat has thresholds and bands (Nisab) whereas Sadaqah has no thresholds.
  8. Zakat was generally distributed where it was collected whereas Sadaqah can be spent anywhere.
  9. Zakat has specific areas and categories for spend whereas Sadaqah does not have defined recipients.
  10. Zakat is monetary whereas Sadaqah can be non-monetary too.

Zakat plays a huge role in establishing Islam in the lives of individuals and the community, by resourcing them in such a way that barriers to ongoing faithfulness at both an individual and collective level are reduced or removed altogether. Zakat has a direct benefit for the payer and society.

As far as the payer is concerned, ones personal Islam is established and strengthened by believing in the obligation of Zakat and paying Zakat accurately. In respect to the society, then the cornerstone of its Islam and subservience to Allah being strengthened is by the holistic, strategic distribution of Zakat.

14. Is Zakat similar to a wealth tax?

The operations of Zakat in respect to calculation, collection, distribution show another dimension of how Zakat functions. The following are rulings of Zakat from the different schools of law:

1. Zakat is paid once a year
2. Zakat is paid on specific assets such as: gold, silver, cash, business assets, agricultural produce, livestock, treasure troves
3. Certain liabilities can be deducted from a Zakat calculation
4. Zakat was collected and distributed by the Islamic government
5. According to some schools of law, Zakat can be forcefully taken. The state can take punitive measures on the non-payers of Zakat,
6. Abandoning Zakat payments is tantamount to treason
7. Zakat has thresholds and bands (Nisab)
8. Zakat was generally distributed where it was collected
9. Zakat has specific areas and categories for spend
10. Zakat cannot be given to facilitate sin

The above operation clearly demonstrates that Zakat has an operational reality to it; it is not simply a charity. The clear guidelines and governmental framework exhibit that Zakat is an institution within a system. One could almost argue that the payment of Zakat and Zakat distribution operate like a wealth tax and has elements of government public sector spending, however, the spiritual element in Zakat makes it more wholesome than tax. Zakat is not viewed as a burden. It is considered more as a commitment and membership payment to a godly cause. The spiritual filter of Zakat makes it different to a secular welfare and benefit system.

15. What is the function of Zakat in the community?

Zakat plays a huge role in establishing Islam in the lives of individuals and the community, by resourcing them in such a way that barriers to ongoing faithfulness at both an individual and collective level are reduced or removed altogether. Zakat has a direct benefit for the payer and the society. Hence, Shah Walilullah (d.1176 AH) states that the benefits of Zakat go back to the payer and to the society . In other words, the growth of ‘subservience to Allah’ takes place in the payer and the society with Zakat. As far as the payer is concerned, his personal Islam is established and strengthened by believing in the obligation of Zakat and paying Zakat accurately. In respect to the society, then the cornerstone of its Islam and subservience to Allah being strengthened is by the holistic, strategic distribution of Zakat.

16. Why has Salat and Zakat been mentioned together repeatedly in the Qur'an?

From the five pillars, the Qur’an mentions the three pillars of Iman, Salat and Zakat together repeatedly. The great scholar, Imam al-‘Iraqi (d.806 AH) states that whoever performs these three pillars correctly, will be able to perform fasting and Hajj easily. Al-Kirmani (d.786 AH) mentions Salat and Zakat have more importance and emphasis due to their universal nature. It is of no surprise then that the Qur’an exhorts steadfastness on Salat and Zakat twenty-eight times. In fact, Mulla Ali al-Qari (d.1014 AH) states that Salat and Zakat are the origins of all worship and good deeds . Imam al-‘Ayni (d. 855 AH) refers to Zakat as the partner of Salat . If Salat and Zakat are rightfully established at a macro and micro level in the society, they will help in all other good deeds and acts manifesting in society. It is upon this establishment of virtue which Allah promises prosperity and harmony for all. “God has made a promise to those among you who believe and do good deeds: He will make them successors to the land, as He did those who came before them; He will empower the religion He has chosen for them; He will grant them security to replace their fear. ‘They will worship Me and not join anything with Me.’ Those who are defiant after that will be the rebels. Establish Salat, give Zakat and obey the Messenger so that you may receive [this] Mercy!” (Quran 24:55-56).

17. Is Zakat purely to eliminate poverty?

Imam al-Tabari (d.310 AH) mentions that the eight categories can be summarised into two essential functions:

1. Fulfilling the needs of the Muslims
2. Assisting and strengthening Islam

From the eight categories of Zakat, the following three categories are not related to poverty alleviation: Amilin alayha (Zakat administrators), al-Mu’allafati Qulubuhum (winning hearts) and Fisabilillah (in the cause of Allah). These categories all go back to the aim of assisting and strengthening Islam. It is worth noting that even the first objective has a critical function to play not just in providing a believer with the material resources he/she requires for essential needs, but in their individual sense of belonging to the Muslim community and in their own ability to maintain a healthy and sustainable state of subservience. In one prayer, the Prophet ﷺ sought refuge in Allah from “disbelief and poverty” (Sahih Ibn Hibban). In another statement, he indicated that poverty leads to disbelief (Al-Tabarani and al-Bayhaqi).

18. What does the word 'Sadaqah' mean?

Ṣadaqah literally means genuineness and sincerity.

The word Ṣadaqah shares the same Arabic root letters with the word Ṣādiq. Ṣādiq means truthful . Paying Ṣadaqah is a true testimony of one’s faith.

In Islamic law, Sadaqah refers to any donation or payment seeking the pleasure of Allah.

In terms of usage, Sadaqah refers to voluntary payments. However, the term Sadaqah has been used a few times figuratively to refer to Zakat in the Quran and Sunnah .

Although Sadaqah has generally been used by jurists for voluntary payments and donations, the prophetic traditions use “Sadaqah” for non-monetary actions such as smiling also. Sadaqah in such narrations refers to reward.

19. What is the position of Zakat in respect to Islam?

Zakat is the third pillar of Islam.

This is understood from the prophetic tradition narrated by ‘Abdullah ‘ibn ‘Umar ibn Al-Khattab (may Allah be pleased with them) who said: I heard the Messenger of Allah (Allah’s blessings and salutations be upon him) say:

“Islam has been built on five [pillars]: testifying that there is no god but Allah and that Muhammad is the Messenger of Allah, performing the prayers, paying Zakat, making pilgrimage to the House, and fasting in Ramadan.” (Sahih al-Bukhari & Sahih Muslim)

These pillars are the foundation of Islam; without the presence of these pillars, Islam is non-existent at a macro and micro level. Thus, Zakat plays a huge role in establishing Islam in the lives of individuals and the community, by resourcing them in such a way that barriers to ongoing faithfulness at both an individual and collective level are reduced or removed altogether.

20. What are the differences between Zakat and Zakat al Fitr?

Zakat al Fitr (or Sadaqat al Fitr) is a duty that is paid on the occasion of Eid al Fitr and is required of every Muslim, whether male or female, minor or adult, if the total value of his/her Zakatable assets (cash, gold, silver, merchandise) plus non-essential items (i.e. assets above his basic needs) minus liabilities (debts) equals or exceeds Nisab. A father must also pay on behalf of his pre-pubescent children if they do not have their own wealth equal to the Nisab. If they have their own wealth equal to the Nisab, they can pay their Zakat al Fitr from their own wealth. The head of the household may pay the required amount for the other family members. In terms of amounts, it is advisable to contact your local mosque and get them to give you the recommended amount to pay per head.

The first difference between Zakat and Zakat al Fitr is eligibility. All Muslims must pay Zakat al Fitr regardless of their age or financial status (unless they honestly do not have the means to do so. The second difference lies in the amount due. The amount attributed to Zakat al Fitr is very small, and rarely exceeds £5. Zakat, however, can amount to a larger number because its 2.5% of all net savings.

The third and final difference lies in their due dates. Zakat can be paid at any time, with the only condition being that the earnings reflect one year’s worth of net savings (one lunar year). Zakat al Fitr , however, goes hand in hand with Ramadan. Zakat al Fitr is paid during Ramadan before the month ends. It needs to be paid before the Eid prayers at the very latest. This is a very specific time frame that all Muslims must abide to.

21. How many times is Salat and Zakat interlinked in the Qur'an?

Salat and Zakat are mentioned together twenty-eight times in the Qur’an. This shows the importance of these two pillars.

22. Was Zakat obligatory on previous nations?

We know from the various passages in the Quran that Zakat was enjoined upon the previous prophets and nations. The specifications of Zakat might have varied just like Ṣalāt and Fasting varied across different nations, but, the centrality of Zakat is identical across all nations.

The Quran gives examples in several verses telling us how Zakat was instructed to the previous Prophets. For example:

Zakat of Prophet Isma’il (peace be upon him):

“Also mention in the Book (the story of) Isma’il: He was (strictly) true to what he promised, and he was an apostle (and) a prophet. He used to enjoin on his people Salat and Zakat, and he was most acceptable in the sight of his Lord.” [Quran 19:54-55]

Zakat of the Banu Isra’il:

“And (remember) when We made a covenant with the Children of Israel, (saying): Worship none save Allah (only) and be good to parents and to kindred and to orphans and the needy and speak kindly to mankind; and establish Salaah and pay Zakat.” [Quran 2:83]

Zakat to the progeny of Prophet Ishaq (peace be upon him): and Prophet Yaqub (peace be upon him):

“And We sent them inspiration to do good deeds and to be diligent in the Salat and pay Zakat.” [Quran 21:73]

Zakat of Prophet Isa (Upon whom be peace):

“He said: Lo! I am the slave of Allah. He has given me the Scripture and has appointed me a Prophet. And has made me blessed wheresoever I may be and has enjoined upon me Salat and Zakat so long as I remain alive.” [Quran 19:30-31]

23. When was the command to pay Zakat revealed to the Prophet (peace be upon him)?

It is mentioned in Tafsir ibn Kathir that the command to pay Zakat was revealed in Makkah. In the 2nd year after the Hijrah (migration) to Madinah, Zakat was institutionalised and obliged with all its specifications.

In Makkah, the verses on Zakat generally pertained to individual charitable payments, and it was left to the individual’s faith and own conscience to decide how much to give and whom to give it to.

We know Zakat was revealed whilst the Prophet was in Makkah as Meccan verses make reference to Zakat payments. For example, in the Meccan chapter titled, ‘The Ascending Stairways’ (Sūrah al-Ma’ārij), Allah Almighty makes reference to Zakat with the following words:

“And in whose wealth there is a right acknowledged. For the beggar and the destitute.” (Quran, 70:24-25)

Around eighteen months after the arrival of the Prophet (Allah’s blessings and salutations upon him) in Madinah, Zakat became institutionalised. Madinah verses gave clear directives ordering the payment of Zakat. In the Medinan period, the Prophet would send out Zakat collectors and distributors.

Great scholars such as Ibn Khuzaymah and Ibn Kathir were of the view that Zakat became obligatory in Makkah whilst other scholars are of the view that Zakat became obligatory after the Hijrah in al-Madinah .

24. What are the punishments for not paying Zakat?

Abu Hurayrah (May Allah be pleased with him) reports:

Allah’s Messenger (Allah’s blessings and salutations upon him) said, “Whoever is made wealthy by Allah and does not pay the Zakat of his wealth, then on the Day of Resurrection his wealth will be made like a bald headed poisonous male snake with two black spots over the eyes. The snake will encircle his neck and bite his cheeks and say, ‘I am your wealth, I am your treasure.’ “Then the Prophet recited the verses: — ‘Let not those who withhold . . .’ (to the end of the verse). (3.180). (Ṣaḥīḥ al-Bukhārī)

This narration explains the severe punishment of not paying Zakat. The verse which the Prophet recited was:
“And let not those who covetously withhold of that which God has bestowed on them of His Bounty (wealth) think that it is good for them. Nay, it will be worse for them. The things which they covetously withheld shall be tied to their necks like a collar on the Day of Resurrection. And to God belongs the heritage of the heavens and the earth, and God is Well-Acquainted with all that you do” (Quran 3:180).

25. What is the legal status of Zakat in Islam?

Zakat is an obligatory act of worship and a fundamental pillar of Islam .

The obligatory nature of Zakat has been established in the most definitive and authentic sources of Islam, namely, the Quran and Sunnah. In addition, there is a scholarly consensus (‘Ijma’) on the obligatory nature of Zakat.

Considering all the above, rejecting the obligatory nature of Zakat draws a question mark on a person’s belief as much as it makes the individual reject an entire heritage and generation.

26. Is Zakat payable on an unborn child?

An unborn child is not liable to pay Zakat. Any wealth set aside for an unborn child will still belong to the donor and the donor will add that wealth to their Zakat calculation.

27. Do we pay Zakat on an estate yet to be distributed?

Potential inheritors do not have to pay Zakat on an undistributed estate.

28. Is Zakat due on the wealth of the deceased?

According to the Hanafi school, any outstanding Zakat will not be paid from the estate without a Wasiyyah in their Will. According to the majority of schools, Zakat will be paid from the estate of the deceased.

29. When is a child considered to be mature to pay Zakat?

According to the Hanafi school, mature individuals are obliged to perform the compulsory forms of worship such as Salat, Zakat, Fasting, and Hajj. Islam considers adolescents as mature. A person is adolescent when experiencing puberty. The following are some indications of puberty :
1. Experiencing a wet dream
2. Menstruation
3. Reaching fifteen lunar years in age (approximately 14 years and 7 months)

30. How is mental capacity ascertained for Zakat obligation purposes?

If the person in question cannot calculate Zakat due to mental incapacity and a lack of mental understanding, Zakat is not binding on such a person.

31. Why do the scholars differ in relation the wealth of children?

The three schools of jurisprudence other than the Hanafi school state that Zakat should be paid on qualifying wealth owned by the orphan, child and the insane.

The three schools of jurisprudence consider the ownership of wealth reaching the Nisab as the driving factor behind the Zakat obligation. Furthermore, the child, insane and orphan’s wealth will also benefit from the purification of wealth due to the payment of Zakat.

The Hanafi school considers the element of worship in Zakat and therefore opines that Zakat is not binding on the orphan, child and insane. Since these individuals are not obliged to perform worship, they are not obliged to pay Zakat. However, if a person has intermittent sanity, they will be required to pay Zakat. Only a person with continuous insanity and mental incapacity is exempt from Zakat .

The parent/guardian will be responsible to pay Zakat on the wealth of the orphan, child and insane. They can pay from the wealth of these individuals.

32. Are non-Muslims obliged to pay Zakat?

Zakat is an action of worship and it is only obliged on those who have faith in Islam. Faith in Islam is a primary condition for the requirement of all forms of worship. Thus, only Muslims are obliged to pay Zakat.

33. What does Nisab mean?

Nisab linguistically means origin, beginning and a starting point.

Technically, Nisab is the minimum threshold of wealth a person must own on their Zakat anniversary at which point Zakat becomes obligatory. Considering the linguistic meaning, Nisab is the origin and starting point of Zakat obligation.

34. What is the evidence of Nisab?

Ali ibn Abi Talib (May Allah be pleased with him) reports that the Prophet (Allah’s blessings and peace be upon him) said:

“If you have 200 dirhams, and it has been saved for a year, (you are) obliged to pay 5 dirhams of Zakat from it. And there is no obligation of Zakat in gold, until you have 20 dinars. If you own 20 dinars and it has been saved for a year, half a dinar must be paid.” (Sunan Abu Dawud)

35. How is Nisab measured?

The standard of the Nisab is gold and silver .

This was stipulated by the Prophet (Allah’s blessings and peace be upon him).

Allah has placed intrinsic worth and value in gold and silver. Gold and silver have universal value and worth. Investopedia describes the natural phenomenon of these metals in the following manner:

Gold doesn’t corrode and can be melted over a flame, making it easy to work with and stamp as a coin. Finally, gold has a unique and beautiful colour, unlike other elements. The atoms in gold are heavier and the electrons move faster, creating absorption of some light; a process which took Einstein’s theory of relativity to figure out.

From a elemental perspective, gold is the most logical choice for a medium of exchange for goods and services. It is abundant enough to create coins, but rare enough that not everyone can make them. It doesn’t corrode, providing a sustainable store of value, and humans are physically attracted to its colour and feel.

In the Prophetic era, the bimetallic currency was common. Arabia used both dinar, the byzantine currency, and the dirham, the Persian currency. When Islam came, the Prophet approved the use of Dinar and Dirham as money. Hence, the Zakat thresholds were pegged on these standards.

36. What is the amount of Nisab in the Islamic texts?

• 20 Dinar (gold coins) also known as the ‘the gold Nisab’.
• 200 Dirham (silver coins) also known as ‘the silver Nisab’.

There are two standards as opposed to one. The reason for this is that Dinar and Dirham were commonly and interchangeably used in the markets in the Prophetic era. The exchange rate at the time was 1:10, and therefore the Zakat payer ended up paying the same amount in terms of purchasing power in the prophetic era.

37. Why is there a gold Nisab and a silver Nisab?

There are two standards as opposed to one. The reason for this is that Dinar and Dirham were commonly and interchangeably used in the markets in the Prophetic era. The exchange rate at the time was 1:10, and therefore the Zakat payer ended up paying the same amount in terms of purchasing power in the prophetic era. However, there is a stark difference between the gold and silver Nisab today. Hence, the silver Nisab is commonly suggested as the benchmark for Zakat obligation.

38. What is the Nisab in grams?

• The gold Nisab is 87.48 grams.
• The silver Nisab is 612.36 grams.

The above Nisab conversions are based on the Hanafi school. Other schools have a gold Nisab of 85 grams and 595 grams of silver.

The unit of mass used at the time of the Prophet was different to what is used today. Therefore, scholars converted different units of mass across time keeping the benchmark 20 Dinar of gold and 200 Dirham of silver. Hence, due to the multiple conversions and juristic differences in understanding some weight and volumetric measurements, scholars have slightly different Nisab standards.

A famous opinion of the conversion rates of Dinar and Dirham is :

1 Dinar = 4.374 grams
1 dirham =3.0618 grams

Therefore:

20 Dinar = 87.48 grams
200 Dirhams = 612.36 grams

39. Is the silver Nisab or gold Nisab used to assess Zakat obligation?

Many scholars are of the view that the silver Nisab should be the threshold to determine who qualifies to pay Zakat. They argue that if the silver Nisab is the threshold, more people are likely to pay Zakat. Consequently, more people will worship Allah through Zakat and the needy will benefit more due to the volume of Zakat payments.

Other scholars are of the view that the gold Nisab should determine who qualifies to pay Zakat. They argue that the silver Nisab is very low and does not accurately differentiate between the rich and the needy.

Majority of the scholars in the UK favour the silver Nisab as the standard for Zakat payers.

40. Is the Nisab substracted from one's total net assets when calculating Zakat?

No, you do not subtract the Nisab for the Zakat calculation. If you have an amount above the Nisab then Zakat is due on the entire amount.

41. Are all assets subject to Zakat?

Not all assets are subject to Zakat. Had Allah made Zakat binding on all that we own, we would have been placed in difficulty. Allah out of His infinite mercy specified assets which are most suitable to be considered for Zakat payments in contrast to others.

Furthermore, only those items have been allocated for Zakat which have intrinsic growth. Although Zakat is calculated on the capital base as well as profit, the actual payment can generally be covered by the profits. This is understood from the following verse:

“And they ask you what they should spend. Say, “The excess [beyond needs].” Thus, Allah makes clear to you the verses [of revelation] that you might give thought.” (Quran 2:219)

According to one explanation of this verse, the excess refers to the capital appreciation and capital gain of Zakatable assets.

42. What is Zakatable?

The following assets are generally Zakatable:

1. Gold and silver
2. Cash and receivables
3. Business stock
4. Investments in Zakatable assets
5. Crops and agricultural produce
6. Animal livestock

Note: There are rules governing the above assets and as such, not everything that may fall in the above will strictly be Zakatable if the other rules and conditions are not met.

43. What is not Zakatable?

Assets which do not fall under the following list are defined as personal assets and are not Zakatable:

1. Gold and silver
2. Cash and receivables
3. Business stock
4. Investments in Zakatable assets
5. Crops and agricultural produce
6. Animal livestock

Thus, all personal assets not in the above are not Zakatable. For example, one’s car, mobile phone, laptop, house, electronic appliances are all not Zakatable regardless of the value.

44. Is there Zakat on the house I live in?

Your property is Zakat exempt. Zakat is not binding on the value of the house you live in.

45. Is there Zakat on my property on rent?

Zakat is not due on the value of one’s rental investment property. Rental property is not a Zakatable asset. However, the rental income is Zakatable asset.

46. Is there Zakat on precious stones like diamonds?

Zakat is not due on the value of one’s personal precious stones such as diamonds.

47. What is the evidence for the obligation of Zakat on gold and silver?

The following verse directly mentions hoarded gold and silver which should have been given in the way of God. The exegetes of the Quran mention that this verse refers to Zakat.

“…those who hoard up gold and silver and do not spend it in the way of God, give them the glad tidings of a painful punishment” (Quran 9:34)

In a prophetic narration, a woman from among the people of Yemen came to the Messenger of Allah with her daughter. The daughter was wearing two big bangles of gold. The Prophet remarked: “Do you pay Zakat on these? She said: “No.” He said: “Would it please you if Allah were to put two bangles of fire on you on the Day of Resurrection?” So, she took them off and gave them to the Messenger of Allah and said: “They are for Allah and His Messenger.” (Sunan an-Nasa’i)

48. What types of gold and silver are Zakatable?

Gold and silver, in whichever form (jewellery, coin, ingots etc.) are subject to Zakat.

The Hanafi school treats all gold and silver jewellery as Zakatable, regardless of whether it is worn or stored.

However, the other schools of Fiqh believe that gold and silver for personal use are exempt from Zakat.

49. Is Zakat due on items composed of mixed metals with gold and silver?

According to the more accurate view among contemporary Hanafi jurists, if a person has personal items made from a mixture of metals, then the gold/silver is liable to Zakat if the gold/silver content can be distinguished and ascertained. Some scholars of the opinion that mixed metals are only liable to Zakat if half or more of the metal is gold or silver.

50. Is a 9 carat ring of gold Zakatable?

The gold content in such a ring is Zakatable. Zakat will only be due on the gold portion of such a ring. The price per gram of that carat of gold will be used to calcualte the total amount of Zakat due.

51. Is Zakat due on gold tooth caps?

If the gold cap is attached in a permanent manner that cannot be removed without surgery, there is no Zakat on the gold cap. However, if it is easily detachable, then there will be Zakat on the gold cap annually.

52. Is there Zakat on white gold jewellery?

White gold is an alloy of gold and at least one white metal, usually nickel, manganese or palladium.

Thus, white gold is treated like normal gold and is subject to Zakāt.

The amount of Zakāt payable would be calculated by multiplying the full weight of the jewellery by the price per gram for gold of that carat.

For example, if one has an 18 carat white gold bangle weighing 50 grams, then 50 grams would be multiplied by the price of a gram of 18 carat gold.

Likewise, if one has a 9 carat white gold bangle weighing 50 grams, then 50 grams will be multiplied by the price of a gram of 9 carat gold.

53. Is Zakat due on gold according to the Shafi school of Islamic law?

In principle, Zakah must be paid on gold that one has owned for a full year, not just once, but for every year that one owns it. However, if the owner of the gold is a female whose purpose in acquiring the gold is to wear it, even if it be only once a year and only to weddings, it will not be incumbent to pay Zakat on it.

54. Which value shall I use to calcualte Zakat on my gold and silver?

For your Zakat calculation, gold and silver can be valued at its resale value. To work out the value of your gold and silver, you can do one of two things:

1. Your local gold jeweller can determine the current value of your gold and silver assets. This is the most accurate method to get the value of your gold and silver. Jewellers will give you the value of your gold according to scrap gold value.

2. Use today’s live gold and silver price in grams – this is known as the universal measurement. These prices are for new gold and are generally more expensive. One may use this measure if they cannot get in touch with a jeweller.

If you use the live gold and silver price, simply multiple the price per gram by the total weight of your gold or silver.

55. How much gold/silver do you have to own before Zakat is payable?

This question can be answered in the context of your net assets. You then need to establish whether your net assets equal or exceed the Nisab threshold. If you exceed the Nisab threshold then Zakat is due on all your wealth at 2.5%.

56. How would we calculate the value of our gold or silver if we know the weight in Tolas, Boris and Voris?

It is worth noting that in the South Asian subcontinent (i.e. India, Pakistan, Bangladesh and Nepal), grams may not be used to measure silver and gold. Instead one of 3 possible units of measurement may be used; these are either: Tolas, Boris or Voris.

One Tola or Bori or Vori is equivalent to 11.66 grams. We know that the Nisab threshold for gold is 87.48 grams, so this is equivalent to 7.5 Tolas, Voris or Bhoris.

57. Are other precious metals such as platinum & palladium to be included when calculating Zakat payments?

Besides gold and silver, there is no Zakat due on platinum and palladium or any othe precious metal.

58. When weighing gold & silver, is the total weight of both combined taken into account or are they both separate due to the nature of the different values?

The value of gold and silver will be determined separately for Zakat purposes.

59. Is there Zakat on silver rings worn by men?

Zakat is payable on silver rings worn by men. The value of the ring should be determined on one’s Zakat anniversary and 2.5% of that value must be given in Zakat.

60. What if I cannot afford to pay Zakat on the gold that I have?

Zakat can be paid in cash and kind. Therefore, if one does not have the cash to pay Zakat on gold, it is permissible to pay Zakat in gold.

61. Is Zakat due on gold bullion and ingot?

Yes, Zakat is binding on buliion and ingots. Zakat is due on any gold article in one’s ownership.

62. Is Zakat due on gold-plated jewellery?

Gold-plated jewellery is not gold jewellery, but it is jewellery made of a base metal that has a very thin layer of gold applied on top of it.

Zakat is not due on base metals besides gold and silver and therefore, Zakat is not due on the base metal of gold-plated jewellery.

In regard to the gold plating, the gold layer is so thin that it can usually be rubbed off with a coarse tool. Therefore, due to the insignificant nature of the layer, Zakat is not due on this either.

63. Is Zakat due on platinum jewellery?

Zakat is not due on platinum jewellery. In terms of jewellery, Zakat is only obligatory on gold and silver.

64. Is Zakat due on gold given as Mahr (dower)?

Zakat is due on all of one’s gold and silver property regardless of how one acquired such items. Therefore, Zakat is due on the gold given as Mahr upon getting married.

65. Why is Zakat due on cash when it was not in existence at the time of the Prophet (peace be upon him)?

Cash and fiat currencies are in the ruling of gold and silver. Therefore, just as Zakat is binding on gold and silver, Zakat is binding on fiat currencies.

66. Is Zakat paid on income like income tax?

Zakaat is paid on accumulated cash which one has in their ownership on their Zakat anniversary, not on one’s income regardless of how much it was and when it was received.

67. Does Zakat have to be paid on cash owned before one was Muslim?

Zakat is only due on Muslims. As such, any Zakatable asset owned before accepting Islam is not subject to Zakat.

68. Is Zakat due on the money kept in a bank account?

Any cash in ownership on one’s Zakat anniversary is Zakatable. Cash includes all income earned whether salaries, benefits or rental.

Cash kept in a bank account, wallet or under the mattress all qualify for Zakat. The place of preserving one’s wealth and cash makes no different.

69. Is the cash received throughout the year and spent also Zakatable?

Zakat is binding on the amount of one’s savings on one’s Zakat anniversary. Regardless of the cash received in the year, only the remainder on the Zakat anniversary will be considered and be subject to Zakat. Money spent throughout the year will not be subject to Zakat.

70. Do I pay Zakat on the interest I have accrued in my bank account?

Despite the explicit prohibition in the Qur’an and Sunnah of dealing with interest, if a person still engaged in interest dealings and received interest, it is not subject to Zakat. Instead, the entire amount of interest money must be dispensed in charity or to public welfare projects as a relinquishment of unlawful wealth and not as a rewarding act.

71. Is there any Zakat due on income which was earned in an unlawful job?

Zakat is not binding on unlawful income. Instead, the entire unlawful income must be dispensed in charity.

72. Is Zakat due on all currencies?

Zakat is due on all the different currencies one owns. Simply convert the currencies into your local currency and add the values up. Thereafter, 2.5% should be paid in Zakat.

73. Is Zakat due on money which I intend to gift to someone in future?

Since you currently own the money, you will be responsible to pay Zakat on this amount.

74. Zakat on cash kept as collateral

Money which has been kept as a collateral is not Zakatable if it has not been invested on behalf of the owner.

75. Is Zakat due on a tenancy deposit

Deposits on assured shorthold tenancies (AST’s) must be protected with a government-approved scheme. Under the Housing Act 2004 the landlord or agent must protect the deposit and issue prescribed information to the tenant within 30 days of receiving it.

A tenancy deposit is a sum of money which a landlord requires a tenant to pay at the start of the tenancy or which the landlord holds over from a previous tenancy with the same tenant. The money is security in case the tenant does not meet their obligations in connection with the tenancy.

Zakat is not binding on a security deposit as it is not in the possession of the tenant – neither constructively nor physically.

76. Zakat on money locked in an investment

Any invested cash is Zakatable even if it cannot be withdrawn during the investment phase.

77. Zakat on cash lost somewhere in the house

If one has hope of finding the money, Zakat will be payable on the amount lost. However, if one has no hope of finding the money, then there will be no Zakat on that money.

78. Do I have to pay Zakat on money which belongs to my brother but I am safekeeping it for him?

Zakat is only due upon the wealth you own. If you are a custodian of somebody else’s wealth, you are not responsible to pay Zakat on that wealth.

79. Is Zakat due on any cash available on a gift card?

Gift cards are loaded with e-money. Zakat will be payable on cash available on gift cards.

80. Is Zakat due on savings for which Zakat was paid the previous year?

Yes, zakat is due on savings for which one has already paid zakat on from the previous year. Zakat is an annual obligation and every year on one’s Zakat anniversary, all the Zakatable assets are included in the calculation.

81. How will salary earners pay Zakat?

When it comes to cash, Zakat is simply paid on the residual cash left over on one’s Zakat anniversary.
So it is irrelevant whether one earns money from salary, investments, benefits, gifts etc. One should simply fix a Zakat anniversary on a date in the Islamic calendar and then pay Zakat on whatever cash they have on the day, plus anything else that qualifies for Zakat.

82. Is Zakat due on money which we are saving to buy a house in the future?

Savings are Zakatable regardless of what is being saved for. Thus, money saved to purchase a house in future is Zakatable.

83. IS Zakat due on money saved for a holiday?

Cash savings are Zakatable even if it is for a holiday. However, if there are any obligations or outstanding liabilities as a result of the booking, that amount can be deducted in one’s Zakat

84. Is Zakat due on money saved for Hajj?

All savings are Zakatable. However, if any debt has been incurred and is outstanding, such as outstanding booking payments, such debts can be deducted from one’s Zakat calculation.

85. Is Zakat due on a maintenance loan?

If the loan is not repayable in the next 12 months, the loan amount will be added to the rest of one’s wealth and will be Zakatable.

86. Is there Zakat due on proceeds from a rental property?

Rental income is Zakatable. However, the value of the rental property is not Zakatable.

87. Does the husband have to pay for the wife's savings?

In principle, Zakat is an obligation on each qualifying individual. Thus, Zakat is primarily due on the husband and wife separately. However, a husband may pay the wife’s Zakat if there is a mutual understanding in this regard.

88. Is Zakat due on a gift?

Money received in a gift is a Zakatable asset. Any remaining amount will be added to one’s Zakatable assets on the Zakat anniversary.

89. I have lost £100 money in my house, do I pay Zakat on it?

If you have hope of finding the money then Zakat will be payable on this money too. However, if you have lost hope in locating this money, Zakat will not be due.

90. I have lost £20 outside and cannot find it. Do I still need to pay Zakat on it?

If you have hope of finding the money then Zakat will be payable on this money too. However, if you have lost hope in locating this money, Zakat will not be due.

91. Someone stole £50 from me recently. Do I have to pay Zakat on it?

Zakat is not due on wealth which has been stolen.

92. Is Zakat due on an amount of money I gave to my brother as a loan?

Zakat is obligatory on a loan every year. However, one has the option to pay the Zakat due yearly or pay for the all outstanding years upon receiving the money.

93. Is Zakat due on the creditor of a loan?

Zakat is obligatory on a loan every year. However, one has the option to pay the Zakat due yearly or pay for the all outstanding years upon receiving the money.

94. Is Zakat payable on an outstanding invoice for the sale of goods?

Zakat is payable on the outstanding amount of sale invoices. The outstanding receivables will be added to the rest of one’s Zakatable assets on the Zakat anniversary.

95. I am owed money for some work I carried out for a client, do I have to pay Zakat on the outstanding amount?

According to a number of scholars, money owed in lieu of a service is not Zaktable.

96. I have lent money to a person who has now disappeared. Do I have to pay Zakat on what was owed to me?

If you have hope of receiving this money, then Zakat will be payable on the amount lent. However, if you have lost hope of receiving this money, Zakat will not be payable.

97. I have lent money to a person who keeps defaulting and delaying in paying me, do I still have to pay Zakat on this money?

If you have hope of receiving this money, then Zakat will be payable on the amount lent. However, if you have lost hope of receiving this money, Zakat will not be payable.

98. Is Zakat payable on loans given to one's family?

Zakat is payable on a loan every year. One may pay Zakat before being paid back. However, if one did not pay, upon receipt, they must pay Zakat for all previous years.

99. I have lost all hope of receiving an amount I lent to a friend. Do I need to pay Zakat on this amount?

In such a scenario, Zakat is not payable on this money anymore.

100. My friend has promised to repay me a loan but has failed to pay me on the promised date. Do I need to pay Zakat on this amount?

If you have hope of receiving this money, then Zakat will be payable on the amount lent. However, if you have lost hope of receiving this money, Zakat will not be payable.

101. Is Zakat payable on my inheritance share which I have not yet received?

Zakat is not payable on an outstanding inheritance share one expects to receive in the near future.

102. Is Zakat payable on outstanding dowry (Mahr) from my Nikah?

Zakat is not payable on outstanding Mahr (dower).

103. Is Zakat due on money my parents have saved and kept for me to give me after my wedding?

If the understanding is that this money currently belongs to your parents, then you will not pay Zakat on it. Your parents will be responsible to pay Zakat on these funds.

104. Is Zakat payable on money I am expecting to receive as a gift?

Money which you have not yet received as a gift is not subject to Zakat.

105. I won a cash prize in a competition but have not received the money yet, is Zakat payable on such wealth?

Money yet to be received from a competition is not Zakatable.

106. Is Zakat payable on a VAT claim?

If a business paid more VAT than it collected, a business can reclaim the difference. Zakat is not binding on the VAT refund it expects to receive.

107. Is Zakat payable on a cheque?

For Zakat to be due on a cheque received by you, the following conditions should be met:

– Physical or constructive possession of the value of the cheque must be established
OR
– The cheque must have been received in exchange of the sale of some commercial goods

When you pay in a cheque, you’ll be able to use the money four working days later – but you won’t be sure the cheque has cleared (i.e. the money is really yours) until six working days after you’ve paid it in. If you use the money in the meantime, you might have to pay it back. Therefore, physical or constructive possession of the value of the cheque are never achieved just by holding the cheque.

Only in some cases (i.e. when a cheque is signed by the bank e.g. banker’s draft etc) one can assume that possession of a cheque amounts to a constructive possession of the value of the cheque. (Mufti Taqi in Fiqhul Buyu’ p441-452 and AAOIFI Shariah Standards (16) item 6/1 and 6/2)

Based on the above, there will be no Zakat on a cheque in the following scenarios:

– If the cheque was received in exchange of a personal item.
– If the cheque was received as a gift or as part of a distribution of a deceased’s estate.
– If the cheque was received in exchange of a service offered (i.e. accounting, tuition etc) or as a payment for a wage.

Zakat will be paid on a cheque in the following scenarios:

– If the cheque was received in exchange of some commercial goods. (see Zakat on money owed to you)
– If one has received a banker’s draft.
– If one has received a cheque signed by a Building Society.

And Allah knows best!

Mufti Billal Omarjee

checked and approved by Mufti Faraz Adam

108. Why is Zakat due on business assets?

The Qur’an and Sunnah have given clear guidance on paying Zakat on business.

The following verse refers to Zakat on business:
“O you who have believed, spend from the good things which you have earned..” (Quran 2:267)

The Sunnah explicitly highlights Zakat on business assets. Samurah bin Jundub (May Allah be pleased with him) said:
‘’The messenger of God commanded us to give Sadaqah (Zakat) on what we intended for trade.’’ (Sunan Abu Dawud)

109. What are business assets according to Zakat principles?

Not all assets owned in a business are Zakatable. So, what defines a Zakatable asset in a business? An asset purchased to resell or developed in a manufacturing contract to sell becomes a Zakatable business asset. Such an asset is a ‘productive asset’ (Mal Nami) in Shariah.

According to all four schools of jurisprudence, only ‘productive’ assets are Zakatable. Productivity in terms of Zakat refers to the potential of an asset to grow and increase in one of the following ways:

1. Intrinsic productivity
2. Productivity by trading
3. Productivity by the breeding of flock

Gold, silver and their substitute fiat currencies are intrinsically and naturally productive, therefore, no intention (niyyah) of trading is required for them and they are always Zakatable assets in themselves. Other assets (excluding animals pastured for their milk and offspring) such as stock and inventory, require an intention to sell for it to become productive wealth (Mal Nami). This intention of sale must be made at the time of a commutative acquisition. Then, as long as the intention for sale remains, the business asset remains productive wealth (Mal Nami) and continues to be Zakatable.

110. Are trade receivables Zakatable?

Outstanding invoices for goods and stock sold on credit are Zakatable. The debt is in lieu of a Zakatable asset, namely, trade stock. Therefore, the counter-exchange is also Zakatable.

111. Is stock and inventory Zakatable?

Stock and inventory are Zakatable assets. Stock and inventory are productive wealth (Mal Nami) according to Zakat principles. The Shariah regards any asset bought to resell as productive wealth and Zakatable.

112. Is Zakat due on the means of production in a business?

Zakat is not due on means of production such as property, plant and equipment.

113. Is Zakat due on operational fixed assets?

Zakat is not obligatory on operational fixed assets such as the premises of the institution and its equipments; or on intangible assets such as patent rights, trademarks and computer software. Zakat is also not obligatory on moveable assets acquired for operation (other than those prepared for trade) such as spare parts and tools used for further production, even when such assets are kept in the warehouses.

114. Are service receivables in a business Zakatable?

Receivables due from delivering services are not Zaktable whilst outstanding. The debt is in lieu of a non-Zakatable asset, namely, services. Therefore, the debt is non-Zakatable whilst outstanding. Thus, outstanding fees, accrued income, wages or payments due in lieu of a service are not Zakatable whilst outstanding.

115. Are prepaid expenses Zakatable?

The prepaid sum is no longer in one’s ownership and therefore it is not Zakatable.

116. Are fixtures and fittings in one's business Zakatable?

Fixtures and fittings are not Zakatable assets. Zakat will not be payable on such assets.

117. Are industrial accessories Zakatable?

Industrial accessories (spare parts) used in production equipment are not part of Zakatable assets.

118. Are property, plant and equipment Zakatable?

Property, plant and equipment are not Zakatable.

119. Are intangible assets such as copyright, trademark, patent and goodwill Zakatable?

Intangible assets such as copyright, trademark, patent and goodwill are not Zakatable. These assets are not purchased to resell and neither do they fall under productive wealth (Mal Nami). They are similar to other fixed assets such as property, plant and equipment.

120. How should stock be valued?

As a principle, all stock should be valued at retail price on one’s Zakat anniversary and not at cost price.

121. How should dead stock be valued?

This refers to stock which has depreciated in value and is illiquid. This should be valued at what it is currently worth as dead stock.

122. How should goods not yet delivered to the business be valued?

This should be valued according to the price in its current location.

123. How should work in progress and raw materials be valued for Zakat?

These should be priced and valued in their current state. If that is not possible, they can be valued at the cost price as a last resort.

124. How should damaged goods be valued for Zakat?

These should be valued at whatever they are worth in their current damaged condition.

125. How should a jeweller value the stock in their business?

Gold, silver and all jewellery are valued at retail price.

126. How does a restaurant value the stock for Zakat purposes?

Ingredients and all foodstuff are Zakatable and are valued at what they are currently worth. If the current value cannot be ascertained, the cost price may be used.

127. How does a property development business value their business assets for Zakat purposes?

Property purchased to resell should be valued at its current market value.

128. How does a grocery store value their stock for Zakat?

Fruits, vegetables and foodstuff should be valued at what they are currently worth.

129. How does one practically add up the value of all stock in business?

Zakat on a business can be calculated in the following three ways:

Stock count

The most precise and ideal method of Zakat calculation is performing a valualtion of stock on one’s Zakat anniversary.

Personal and up to date record

If a stock count is very difficult or impractical, a business should keep a track and record of upto date transactions, cash flow and stock. This can then be used as a fairly accurate method to calculate Zakat.

Use the Balance Sheet

If keeping an accurate record is very difficult and almost impractical due to a high quantity of stock and Zakatable assets, as a last resort, you may use the last balance sheet as a reference for your net Zakatable assets. However, in such a scenario, one MUST do the following two:

1. consider and determine any obvious adjustments to his net Zakatable assets on the actual Zakat anniversary.

2. Apply the gross margin percentage to the value of stock on the balance sheet.

As a precautionary measure to ensure one’s Zakat liability is fulfilled, paying a little more than your net figure is prudent and sensible.

130. How does one use a balance sheet for Zakat calculation?

The value of stock and inventory on a balance sheet reflects the cost price and not the current retail price. Therefore, one should try his best to accurately determine the total value of the retail prices of his stock. To get a more accurate representation of the retail price of stock, one may apply a conservative gross margin percentage to his current stock to get an idea of the current retail price of the stock. Remember, gross margin is net sales less the cost of goods sold. This can be determined from the income statement.

Determining Gross Margin Percentage

Step 1: Look up Net Sales and Cost of Goods Sold in the income statement found in the company’s accounts.

Step 2: Minus the Cost of Goods Sold from Net Sales. This will give you a gross profit figure.

Let’s assume that a company has net sales of £50,000 and its cost of goods sold is £40,000. This means its gross profit is £10,000 (net sales of £50,000 minus its cost of goods sold of £40,000).

Step 3: Calculate the percentage of gross profit in relation to the net sales.

£10,000 (gross profit) is 20% of £50,000 (net sales). Therefore, the gross margin percentage is 20%.

Step 4: Apply the gross margin percentage to the value of stock on your balance sheet.

If the current stock is valued at £100,000, the proxy of 20% can be utilised by adding 20% to the current stock value. Therefore, the current stock can be estimated to be worth £120,000 at retail price.

It would be praiseworthy and prudent to pay extra Zakat on stock to cover any possibility of miscalculation.

131. How does a change in intention affect Zakat on business assets?

The Zakat treatment for business assets is principally based upon the intention at the time of purchasing an asset or stock. Assets purchased to resell are Zakatable business assets. However, a person can have different intentions when purchasing an asset, therefore, it is worth considering the different types of intentions and their consequences in respect to Zakat liability.

1. Clear intention to resell

If an asset is purchased with the express intention to resell, it will be a Zakatable business asset regardless of when it is eventually sold.

2. Clear intention for personal use

If an asset besides gold, silver or currencies was purchased for personal use, then such an asset will not be Zakatable.

3. No clear intention

If an asset is purchased without any intention or without a clear and express intention, then the asset is not Zakatable.

4. A conditional intention

If an asset is purchased for personal use with an intention of selling only if there is capital appreciation, such an asset will not be Zakatable. Similarly, if an asset is bought for personal use or as buy to let with the intention to sell one day in the future upon favourable market conditions, the asset will not be Zakatable.

5. Clear intention to resell in future but leased in the interim

If an asset is bought to resell but is leased in the interim, the property or asset will be zakatable if the intention to resell remains and it is still treated as saleable in the interim.

Remember

All four schools of jurisprudence agree that for a business asset to be Zakatable, an intention to resell that asset must be present at the time of purchasing that asset.

132. Upon purchasing something, I had a clear intention to resell the item. Does that make the item Zakatable?

If an asset is purchased with the express intention to resell, it will be a Zakatable business asset regardless of when it is eventually sold.

133. I bought some items from eBay to resell, but it has been 6 months and they still have not been sold. Are the items Zakatable?

If an asset is purchased with the express intention to resell, it will be a Zakatable business asset regardless of when it is eventually sold.

134. Who is responsible to pay Zakat in a sole trader?

The owner is responsible to pay the entire Zakat on the net Zakatable assets of the business.

135. How is Zakat paid in a business partnership?

Each partner is responsible to pay Zakat on their share of the underlying net Zakatable assets. Alternatively, the partners can agree to take out the Zakat of the company from the company funds without paying from the partners’ personal wealth.

136. Who is responsible to pay Zakat for a limted company?

The shareholders are responsible to pay Zakat on the net Zakatable assets of a limited company.

137. How does an asset become a Zakatable business asset?

The Zakat treatment for business assets is principally based upon the intention at the time of purchasing an asset or stock. Assets purchased to resell are Zakatable business assets.

All four schools of jurisprudence agree that for a business asset to be Zakatable, an intention to resell that asset must be present at the time of purchasing that asset.

The majority of scholars assert that an intention to resell must coincide with a commutative transaction like a sale. An intention to resell which coincides with non-commutative transactions like gifting and inheritance will not make an asset a Zakatable business asset.

A business asset will no longer be Zakatable if a person changes his mind about selling the item and stops trading that asset.

Personal items up for sale will not be Zakatable whilst on the market. Only the net cash from the eventual sale on one’s Zakat anniversary is Zakatable.

138. If a person has a clear intention to resell something they have bought, does it make that item subject to Zakat?

If an asset is purchased with the express intention to resell, it will be a Zakatable business asset regardless of when it is eventually sold.

139. If an asset is bought with a clear intention for personal use, is it Zakatable?

If an asset besides gold, silver or currencies was purchased for personal use, then such an asset will not be Zakatable.

140. If there is no clear intention as to what it is for when an asset is purchased, is it still subject to Zakat?

If an asset is purchased without any intention or without a clear and express intention, then the asset is not Zakatable.

141. If I purchased an asset with an intention to resell contingent upon something, is the asset Zakatable?

If an asset is purchased for personal use with an intention of selling only if there is capital appreciation, such an asset will not be Zakatable. Similarly, if an asset is bought for personal use or as buy to let with the intention to sell one day in the future upon favourable market conditions, the asset will not be Zakatable

142. I have bought a property with the intention to resell but I have leased it out until I find a buyer, is the property Zakatable?

If an asset is bought to resell but is leased in the interim, the property or asset will be Zakatable if the intention to resell remains and it is still treated as saleable in the interim.

143. Which investments are Zakatable?

Any investment in Zakatable assets such as gold, silver, cash, commodities are Zakatable. Shares, unit trusts and equity investments that you have purchased with the intention to make a profit and resell – or through which you receive dividends are all Zakatable.

144. Do all shareholders have to pay Zakat?

In terms of Zakat, there are two types of shareholder:

1. The person who buys shares as an investment and wants to attain dividends – this type of shareholder pays Zakat on the percentage of Zakatable assets on the balance sheet – NOT the entire market value of the shares

2. The person who buys shares to sell – i.e. trading stock. This type of shareholder must pay Zakat on the market value

145. Can you give a step-by-step guide on how to calculate Zakat on shares?

STEP 1: Get hold of the balance sheet

If shares are bought as an investment to attain dividends, the shareholder needs to view the balance sheet of the company. This can be acquired by searching online by simply typing in the company name followed by balance sheet e.g. “XYZ Balance Sheet”.

STEP 2: Identify Zakatable assets on Balance Sheet and add up their values

The following are typical Zakatable assets on a balance sheet:
• Trade and other receivables
• Inventories
• Derivative financial instruments
• Investments
• Cash and cash equivalents

The following are typical non-Zakatable assets:
• Intangible assets
• Property, plant and equipment

Add up the value of all Zakatable assets on the balance sheet.

STEP 3: Subtract deductible liabilities from the Balance Sheet

The following are typical deductible liabilities on a Balance Sheet:
• Current loans and other borrowings
• Trade and other payables
• Current tax liabilities

STEP 4: Find out the market cap (the worth) of the company

Find the market cap of the company you have shares in by simply making a search online of ‘Market Cap XYZ’. This should show up on the search:

STEP 5: Calculate the percentage of Zakatable assets in the company

Divide the net Zakatable assets by the market value of the company and multiply by 100. This will give you a percentage.

STEP 6: Calculate the equivalent amount in pounds of the percentage acquired from step 5

Apply the percentage calculated from step 5 to your shares. You will get a value in pounds.

Step 7: Pay Zakat on shares by paying 2.5% of the value from step 6 or add it to the rest of your calculation

Pay 2.5% Zakat of the Zakatable assets amount in pounds.

146. Can a proxy or estimate be used for Zakat calculation on shares purhcased as a long-term investment?

National Zakat Foundation’s (NZF) recommendation to Muslim shareholders is as follows:

Ideally, a complete calculation and review of the balance sheet should take place to determine precise Zakat liability on any Sharia compliant shareholding. However, due to the technicalities and difficulties in this, a person may use a proxy of 25%.

When using the proxy, calculate 2.5% of 25% (0.625%) of one’s entire shareholding and pay the sum as Zakat.

This proxy cannot be used by shareholders of private limited companies. Likewise, a small company or start-up which is known to have only cash assets, should not use this proxy. Limited companies, startups and general partnership companies may contact NZF to work out their Zakat liability.

Note: The previous NZF recommendation of 40% is no longer applicable. Each year the proxy is revised to keep up to date with the most accurate representation of the composition of listed companies.

147. If I am buying and selling shares daily to make a quick profit, is Zakat due on those share?

If shares are purchased to resell seeking profit, the entire value of the share is Zakatable.

148. Please could you advise if I have ISA accounts and stocks and shares, do I pay Zakat on the portion I hold?

If you have shares in an ISA wrapper and you have no current plans to sell, then you need to pay Zakat on your proportionate holding of the Zakatable assets that exist within the companies in which you have share.

149. How do I calculate Zakat on shares?

If you are holding these shares as a long-term investment then Zakat is due on your proportionate ownership of the Zakatable assets of the companies in which you have invested. Normally this is done by finding out which stocks you own, how many shares you own and then using the company balance sheets to work out roughly what the Zakatable assets are in each firm. If it is difficult for you to determine this then simply take 25% of the current market value of your portfolio as a proxy for the Zakatable assets of the underlying companies and then pay 2.5% of this value.

e.g. if your portfolio is worth £10,000, take 25% which is £2,500 and then 2.5% of this which would be £62.50.
The increase and decrease in portfolio value is irrelevant – only the current value matters.

150. I have shares with the intention to sell? Are they all Zakatable?

You will have pay Zakat on the total value of the portfolio. For example, the shares that you own in company X are valued at £1000 on your Zakat anniversary date, you will pay Zakat at 2.5% on this value i.e. £25.

Remember your Zakat in due on how much the shares is worth on your Zakat anniversary date.

After selling the share, the proceeds will be liable for Zakat if you still own these funds on your Zakat anniversary.

151. Is Zakat due on a child trust fund?

Zakat is not due on children who are minor and prepubescent in the Hanafi school. However, according to the Shafi’i, Maliki and Hanbali schools, Zakat is obligatory on the wealth of minor children also. Thus, in the Hanafi school, the issue of Zakat on CTFs will only be questioned upon maturity and puberty of the child.

There are three types of Child Trust Funds:

1. Stakeholder account

These accounts see your children’s savings put into stock market investments. Stakeholder rules mean that charges are capped at 1.5% a year, and they have to be invested in a wide mix of investment types. After the child’s 13th birthday, the investments are transferred to less risky portfolios.

2. Shares account

These types of accounts allowed you to either pick an investment fund to put your children’s savings onto the stock market, or pick your own investments.

3. Savings account

Such CTFs are not invested in shares, rather, they accrue interest.

In regards to the Stakeholder and shares Child Trust Funds, Zakat will be due on the underlying Zakatable assets in the fund. This can be gauged by looking at the asset composition in the fund. One will pay Zakat on the proportion of Zakatable assets in the fund.

In a savings Child Trust Fund, the entire amount minus the interest element is Zakatable. One hundred percent of the interest earnings must be relinquished in charity. At the same time, one should move to a Shariah compliant CTF.

Regarding the timing of Zakat on CTFs, the mature child can pay Zakat on it every year before having the ability to access the funds. It is also permissible to delay the payment of Zakat upon accessing the funds. If one chooses to wait until access, it will be obligatory to backdate and pay Zakat for the previous years after becoming mature until acquiring access.

152. Is Zakat due on Bitcoin?

According to our understanding, Bitcoins are Zakatable. One may pay 2.5% of his Bitcoin holdings as Zakat or alternatively, pay 2.5% Zakat in one’s domestic currency equivalent to the value of 2.5% of one’s Bitcoin holdings.

The Fiqh (jurisprudence of the answer):

Bitcoins are Zakatable as they are Mal (wealth), have Taqawwum (Islamic legal value) and are in the ruling of a currency (Thamaniyyah).

Does a currency have to have alternative utility besides a medium of exchange? Mufti Taqi Uthmani clearly states that “Money has no intrinsic utility, it is only a medium of exchange” (An Introduction to Islamic Finance). If something is adopted as a currency which has other utilities, the other utilities are not considered when exchanging this currency for another currency – the other utilities are considered ma’dūm (non-existent).

For anything to be considered as Mal, it must have desirability and storability. Bitcoin possesses features which gives it desirability. For example, the blockchain technology behind Bitcoin, the replacement of trusted party intermediations with the proof-of-work protocol, decentralisation, limited supply and borderless payments with less transactional fees make Bitcoin desirable (some of these features are diminishing). This has resulted in a demand for Bitcoin. In respect to storability, Bitcoins are encoded within the blockchain and are entries on a public ledger. Your ownership is reflected by your Bitcoin address being credited with a balance. Considering that Bitcoins are merely digits and entries on a public ledger, there is no evidence or premise indicating to them being unlawful. Hence, Bitcoins have Taqawwum. In terms of Thamaniyyah, Bitcoin was created as peer to peer payment systems. As a result, they are established as currencies

It can be argued that Bitcoin was launched as media of exchanges and as currencies. They are introduced as currencies and are usable as currencies. The blockchain provides a system for this currency. The fact that people are using them as investments does not negate their currency feature. It just gives them similarity to investing in foreign currencies. Indeed, Bitcoin has features which make them unique. If in future they ceased to be used as a medium of exchange and nor was there any speculative increase in their price, would Bitcoin hold any value among people? Would people have Tamawwul of Bitcoin and use of them? Bitcoin would be meaningless digits. Therefore, at present, they have some monetary use and people have assigned ‘a value’ to these Bitcoins. A ‘value’ is envisaged by the people as they purchase, sell, accept and exchange the form of Bitcoins for the underpinning notional value. The value of things can be manipulated, exploited and speculated. These are external issues which require regulation and control.

The philosophy of value has to also be reconsidered. The technological developments in the last century have reshaped and redefined our way of life. For example, value is represented today by mere digits on a bank app which are backed by the government. Society gives value to digits displayed in their bank balances because of the system and acceptability of these digits among people. If an alternative system was created which gave a certain degree of trust, security, ease of use and similar features, why can’t the digits on that system be considered to be digits representing value? A system which is acceptable among people is sufficient to establish a currency in Shariah.

Value is a concept; something people have social concurrence on. Value is something which attracts Mayl (inclination). This value is a meaning, a notion underpinning cryptocurrency digits. The value in Bitcoin is there due to the practices and inclinations of the people. The digits shown as a balance in digital wallets and on the public ledgers represent a value in the minds of people. People have an economic inclination to it and have economic benefit from these Bitcoin. There is no other tangible gain from Bitcoin. Thus, the most plausible interpretation (Takyif) seems to be that Bitcoin is a currency. All other issues with regards to volatility, laundering, black markets etc. are all external matters which need controls and regulation to address them.

153. Is Zakat due on cryptocurrencies?

Any cryptocurrency or token purchased to resell will always be Zakatable. Zakat is due on the market value on one’s Zakat anniversary. The cryptocurrency value should be converted into one’s local currency at the time of calculation.

154. Is Zakat due on a property fund which invests in brick and mortar?

If a property fund invests in brick and mortar for rental income, then in terms of Zakat, you will only need to pay Zakat on the cash element in this fund. The percentage and value of the property will not be Zakatable.

155. Is Zakat due on cash placed in a Waqf?

Zakat is not due on wealth passed into a valid Waqf. The Waqf wealth no longer belongs to the person and therefore it is not Zakatable.

156. Is Zakat due on a bonds and treasury bills?

Bonds and treasury bills are interest-bearing debts and are prohibited. They are not Shariah compliant. However, Zakat is payable on the principal amount of the bond (cost of the bond), whereas the entire amount of interest should be donated for charitable purposes.

157. Is every pension Zakatable?

No, not every pension is Zakatable. Defined benefit schemes (also known as final salary and career average pensions) are not subject to Zakat. However, defined contibution schemes are Zakatable.

158. Are defined contribution schemes Zakatable?

Yes, defined contribution schemes are Zakatable. This means that an employee needs to calculate the amount of Zakat payable on their pension investment during employment whilst contributing. They will pay Zakat each year whilst the funds are invested in Zakatable assets.

159. How can I determine the type of pension I have?

To determine the type of your pension, you may:

1. Check your pension statements
2. Call your pension provider
3. If it is a workplace pension, consult the HR department

160. Are all asset classes in a pension fund Zakatable?

A pension fund generally invests in a range of assets. Some assets in the pension fund are Zakatable whilst others are not Zakatable. Common Zakatable assets in a pension fund include: Equities, fixed income, precious metals, cash and equivalents, alternatives and commodities.

161. Is Zakat due on precious metals in a pension portfolio?

If precious metals consist of gold or silver, then these are Zakatable at 100%. Other precious metals are not Zakatable unless they are commodities and purchased to resell for capital gain.

162; How is Zakat calculated on a pension?

To calculate Zakat on your pension, you need to:

Step 1: Identify the asset class information of your pension fund

This can be done by one of the following ways:

a. Look at the asset allocation on the Pension Factsheet in your statement.
b. Search the name of your pension fund on www.trustnet.com to see the asset allocation and breakdown.

Step 2: Determine the total percentage of Zakatable assets in your pension fund

Add up the percentage of all Zakatable assets in the pension fund.

Step 3: Apply the percentage on the total value of your pension fund

To determine the value of Zakatable assets, apply the percentage of Zakatable assets on your pension fund.

Step 4: Pay 2.5% Zakat on the figure determined from step 3

163. Is Zakat due on a Personal Pension Plan?

If the Personal Pension Plan is a defined contribution scheme, you will need to pay Zakat on the Zakatable assets in the portfolio annually.

164. Is Zakat due on a Self invested Personal Pension (SIPP)?

Since the Self Invested Personal Pension is a type of defined contriubtion scheme, you will be liable to pay Zakat on the Zakatable assets in the portfolio annually.

165. What is the evidence that Zakat is due on Pensions?

A pension fund is composed of a number of Zakatable assets such as cash, gold, silver, business stock and equities of Zakatable assets. Therefore, the same evidences which apply individually to these asset classes apply to these assets in a pension fund.

166. Why are liabilities deductible?

Not all liabilities are deductible, only certain debts are deductible. Worship has not been enjoined to bring difficulty to man, rather, worship is there to accelerate man to Allah whilst considering his needs, circumstances and life. Thus, Ṣalāh has only been enjoined five times a day with most prayers in the evening when a person is free from the chores of the day. Ḥajj is only obligatory if a person can safely reach Makkah and bear all the costs. Fasting has been enjoined only for the day with strong encouragement in the Sunnah to eat right up to the break of dawn and to break the fast immediately upon sunset. In the same manner, a person who has wealth can first deduct his liabilities and debts from his total before determining how much wealth he must pay Zakat upon.

One of the reasons why Zakat is not due on life essentials such as food, shelter and clothes is that these items ward off harm from oneself. They are essentials to survive and they preserve life. The repayment of debt is also considered an essential of life; repayment of debts protect a person from punitive measures and legal action. Therefore, Zakat is not due on immediate debts just as Zakat is not due on other life essentials.

167. Which debts can be deducted from my Zakat calculation?

Certain debts can be deducted from one’s value of assets in a Zakat calculation.

Deductible debts:

1. Debts payable in full within 12 months

Incurred expenses to be settled in full within 12 lunar months can be deducted from one’s Zakat calculation.

2.12 months’ instalments of long term liabilities

If the debt is scheduled to be repaid over a number of years, on the Zakat anniversary, one may deduct one year’s worth of instalment repayments.

3. Arrears

All arrears and overdue payments can be deducted from one’s Zakat calculation.

4. Personal loans from relatives and friends

The amount you intend to repay in the next 12 months.

5. 12 months of Bank loans

The capital repayment due for the forthcoming lunar year from a long-term bank loan can be deducted. Any interest element is prohibited and cannot be deducted.

With regards to debt deductions, there is permissibility cited by scholars to deduct one year’s worth of repayments. However, this deduction should only be made if paying Zakat will impact your ability to repay the debt. If the Zakat payment does not impact your ability to repay your debt, we encourage that the deduction is not made or at most, deduct one month’s debt payables. The reason for this is that the philosophy of deducting debts was based on Zakat payments affecting your ability to repay the debt and in turn, put you in harms way. When a person is not in harms way at all by paying Zakat despite having debt, then the debt ought not to be deducted.

168. Can I deduct a debt payable in full within the next 12 months from my Zakat calculation?

Incurred expenses to be settled in full within 12 lunar months can be deducted from one’s Zakat calculation.

169. If I have a long-term debt for a number of years, is there any portion that I can deduct from my Zakat calculation?

If the debt is scheduled to be repaid over a number of years, on the Zakat anniversary, one may deduct one year’s worth of installment repayments.

170. Can I deduct debt arrears from my Zakat calculation?

All arrears and overdue payments can be deducted from one’s Zakat calculation.

171. If I owe money to my family member who gave me a loan, can I deduct that loan from my Zakat calculation?

Whatever you intend to repay in the next 12 months to your family member can be deducted from your Zakat calculation.

172. Can a conventional bank loan be deducted from my Zakat calculation?

The capital repayment due for the forthcoming lunar year from a long-term bank loan can be deducted. Any interest element is prohibited and cannot be deducted.

173. Are future expenses and bills deductible from my Zakat calculation?

Expenses not incurred yet but will incur in the future cannot be deducted at present. For example, next month’s rent or next month’s utility bills cannot be deducted right now.

174. Can I deduct next month's rent from my Zakat calculation?

In principle, you may only deduct debts which have been incurred. Next month’s rent is not yet incurred nor demanded. Therefore, you cannot deduct this at present from your Zakat calculation.

175. Can I deduct next month's utility bills from my Zakat calculation?

In principle, you may only deduct debts which have been incurred. Next month’s utility bills are not yet incurred nor demanded. Therefore, you cannot deduct this at present from your Zakat calculation.

176. I have a debt which is not payable at all until 3 years. Is it deductible from my Zakat calculation?

A long-term debt which is not repayable within the next 12 months cannot be deducted right now from your Zakat calculation.

177. Can I deduct my student loan from my Zakat calculation even though I am currently studying and not repaying it?

A long-term debt which is not due to be repaid now or in the next 12 months cannot be deducted right now. For example, despite the scholarly debate on the impermissibility of conventional student loans, a student who did take out a student loan cannot deduct the debt during his studies as that is not currently payable.

178. I am repaying my student loan right now. What can I deduct from my Zakat calculation?

You may deduct the next 12 months’ worth of capital repayments of the loan from your gross Zakatable assets total. You should not deduct the interest repayment.

179. I have interest to repay on a loan. Is interest deductible?

Unlawful debts and repayments like interest repayments are not deductible from one’s gross Zakatable assets total.

180. Are current liabilities deductible from my business Zakat calculation?

Incurred expenses to be settled in full within 12 lunar months can be deducted from one’s Zakat calculation.

181. What portion of long-tern and non-current liabilities can be deducted from my business Zakat calculation?

For long-term liabilities, only the non-interest or capital amount can be deducted only for the forthcoming lunar year on one’s Zakat anniversary.

182. Are arrears in my business deductible for my Zakat calculation?

All arrears and overdue payments can be deducted from one’s Zakat calculation.

183. If a business has borrowed capital from a bank, what can be deducted from the Zakat calculation?

The capital repayment due for the forthcoming lunar year from a long-term bank loan can be deducted.
Any interest element is prohibited and cannot be deducted.

184. Are outstanding invoices deductible for my business Zakat calculation?

Outstanding payable invoices can be deducted from the Zakat calculation if they are to be settled within the next 12 months.

185. Can I deduct utility bills from my business Zakat calculation?

Any current and outstanding utility bill is deductible.

186. Can corporation tax be deducted in my Zakat calculation for my business?

Unpaid tax in relation to a previous financial year can be deducted from one’s cash balance when calculating Zakat due.
However, any money being saved to pay for taxes in relation to the current financial year cannot be excluded.

187. Can capital gains tax be deducted from my Zakat calculation?

Outstanding Capital Gains Tax can be deducted from one’s Zakatable assets even before HMRC inform you of the Tax due if you can work out the amount of Tax due.

188. Are outstanding PAYE bills deductible from our Zakat calculation?

Outstanding PAYE bills are not subject to Zakat.

189. Should outstanding debts be deducted?

With regards to debt deductions, there is permissibility cited by scholars to deduct one year’s worth of repayments. However, ideally, this deduction should only be made if paying Zakat will impact your ability to repay the debt. If the Zakat payment does not impact your ability to repay your debt, we encourage that the deduction is not made. The reason for this is that the philosophy of deducting debts was based on Zakat payments affecting your ability to repay the debt and in turn, put you in harms way. When a person is not in harms way at all by paying Zakat despite having debt, then the debt ought not to be deducted.

190. Is a council tax bill deductible?

If the tax bill has been incurred and is payable within the next 12 months, one may deduct the outstanding amount due. However, we encourage that only one month’s repayment be deducted.

191. Can I deduct the the monthly payment I make in an interest only mortgage?

Interest is not a deductible debt from a Zakat calculation. Therefore, in such a scenario, such a mortgage would not be entitled to deduction from one’s Zakat calculation.

192. Can I deduct the remaining balance I have to pay towards the cost of going to Hajj?

If the places have been booked but have an outstanding balance to pay, you can deduct that from the Zakatable assets’ total.

193. Is money owed to a kitty or committee scheme deductible?

Any money owed to the scheme can be deducted from one’s Zakatable assets value.

194. Is child maintenance deductible from my Zakat calculation?

Child maintenance can be a requirement of shariah or a requirement of the law of the country.

If a person is required by shariah to provide child maintenance, then there are two possible scenarios:
1. From a legal perspective (i.e. decision made by the court) one is also required to pay: In this case, he can only deduct payments which have fallen in arrears and the current monthly payment which is due. But he cannot deduct future monthly payments as they are not demandable yet.

2. From a legal perspective he is not required to pay but he has come into an agreement with his partner to pay the maintenance: No amount can be deducted unless the current guardian of the child had to buy necessary items on credit for which the father is now responsible to repay.

If a person is not required by shariah to provide with child maintenance:
3. From a legal perspective he is required to pay: The same as point number 1 will be applicable.

4. From a legal perspective he is not required to pay but he has come into a friendly agreement to pay for maintenance: In this case he will not be able to deduct anything; including the cost of items bought on credit by the current guardian of the child.

Please approach your local scholar to find out whether you are required by shariah to provide for child maintenance.

195. Can a credit card debt be deducted from my Zakat calculation?

You can deduct the amount you owe and will be repaying within the next 12 month. you cannot deduct the amount of credit which you haven’t used.

196. When should Zakat be paid?

The four mainstream schools of Islamic jurisprudence, namely, the Hanafi, Shafi’i, Maliki and Hanbali schools are all in agreement that the payment of Zakat is due immediately upon one’s anniversary.
Zakat is an immediate obligation as Allah has instructed us to pay immediately in the following verse: “And give its due on the day of its harvest.” (Qur’an 6:141)

197. Can Zakat be prepaid and in advance?

Zakat can be paid in advance before one’s Zakat anniversary. The wisdom behind this is to encourage people to increase in worship and capitalise on blessed times like Ramadan or the first ten days of Dhul Hijjah.
If a person does pay Zakat in advance, it is still necessary to make a Zakat calculation on one’s Zakat anniversary to ensure the advance payments offset the actual Zakat liability.

198. Where should Zakat be distributed?

We encourage Zakat to be given locally. This is based in part on the instruction that the Messenger of Allah (peace be upon him) gave to his companion, Mu’adh, who was sent to spread the message of Islam in Yemen, “O Mu’adh! Inform them that Allah makes Zakat obligatory for them, (it is) to be taken from their rich and given to their poor.” (Sahih al-Bukhari)

As the need for those eligible to receive Zakat is increasing and such individuals have a right to the support of UK Zakat payers.

199. Does Zakat have to be paid on one's Zakat anniversary?

Zakat must be paid as soon as it becomes obligatory. Zakat is an immediate obligation. Only when there is a valid reason can it be delayed; however, it must be paid as soon as possible.

The four mainstream schools of Islamic jurisprudence are all in agreement that the payment of Zakat is due immediately upon become obligatory .

Zakat is an immediate obligation as Allah has instructed us to pay immediately in the following verse:
“And give its due on the day of its harvest.” (Quran 6:141)

Although this is referring to Zakat on crops, the overwhelming majority of scholars are unanimous that the same ruling applies to all forms of Zakat. Furthermore, Zakat is a monetary obligation to fulfil an immediate, pressing and urgent need. Hence, such a need can only be fulfilled when Zakat is paid immediately.

200. Can I pay Zakat before my Zakat anniversary?

Zakat can be paid before one’s Zakat anniversary in advance .

The wisdom behind this is to encourage people to increase in worship and capitalise on blessed times like Ramaḍan or the first ten days of Dhul Hijjah.

Once, al-Abbas came to the Prophet (May Allah bless him and grant him peace) and asked if he could pay Zakat in advance. The Prophet permitted him making an advance payment. (Sunan al-Tirmiẓi)

The scholars agree that one must have a Zakat anniversary and a yearly cycle in order to pay in advance. Whilst the Shafi’i school permit only one year’s payment in advance, the Hanafi school does not limit the years for which one can pay in advance.

However, if a person does pay Zakat in advance, it is necessary to recalculate Zakat on the actual Zakat anniversary to ensure the advance payment offsets the actual Zakat liability one had.

201. Is there any special virtue for paying Zakat in Ramadhan?

The paying of Zakat in the month of Ramadhan has been encouraged in the Sunnah.

The Prophet was asked which fast is better after the fast of Ramaḍan, he said: the fast of Sha’bān to honour Ramadan. Then he was asked which charity is best, he said the charity that is given in Ramadan. (Sunan al-Tirmiẓī)

This Ḥadīth signifies the blessings of the month of Ramaḍan. Ramaḍan is a season wherein the rewards for good deeds are magnified. Many assume that Zakat is only paid in Ramaḍan. This is inaccurate. Zakat can be due at any time of the year; Zakat is binding on one’s Zakat anniversary. This can be at any time of the year.

To benefit from the above virtue in the Ḥadīth, one may pay Zakat in advance in Ramaḍan. However, it is incorrect to delay one’s Zakat payment until Ramaḍan and pat Zakat in arrears.

202. What does Tamlik mean?

A Zakat payment is valid if ownership has been unconditionally transferred to the recipient. This is known as Tamlik. Tamlik is necessary in all four mainstream schools of jurisprudence. The transfer must not be remuneration or consideration for services. However, Al-‘Amilina ‘Alayha (Administrators of Zakat) are exempt from this rule.

203. Does money have to be transferred to the recipient for Zakat validity?

A Zakat payment is valid if ownership has been unconditionally transferred to the recipient. This is known as Tamlik.

Tamlik is necessary in all four mainstream schools of jurisprudence.

204. Is it important to have an "intention" when giving Zakat just as we make an intention before praying salah?

As Zakat is an act of worship, to have an intention (niyyat) is a condition of its validity. The majority of scholars from the 4 schools of jurisprudence are in agreement on this matter. The intention must be there at the time of paying the Zakat.
According to the Hanafis, Malikis and Shafiis the intention can also be made at the time of setting money aside for the payment of Zakat.
There is nothing specific to say when making this intention. It suffices to merely have the thought in your mind.
If a person makes a donation without having the intention for Zakat, then this donation will not be counted as Zakat. If later they make the intention for this donation to count towards their Zakat, it will still not be valid. The liability of the Zakat will remain until they make the donation again with the “Zakat intention”.

205. Is it necessary to have an intention when paying Zakat?

Having an intention of paying ‘Zakat’ is necessary. Zakat is an act of worship and all acts of worship require an intention .

Intention is being conscious of what one is doing. It is not necessary to verbalise an intention.

When giving Zakat, the intention of the individual should be based on fulfilling Allah’s commandments. Giving Zakat with pure and sincere intentions will ensure rewards in the hereafter; Sūrah Al-Baqarah (2:276) tells us that: “Allah will deprive usury of all blessing, but will give increase for deeds of charity: For He does not love the one who is ungrateful and wicked.”

206. What does it mean to have an intention when paying Zakat?

Intention is being conscious of what one is doing. It is not necessary to verbalise an intention.

207. Am I responsible for paying Zakat of the gold jewellery of my wife?

Zakat is obligatory on each eligible person.

Every person is primarily required to pay their own Zakat. Hence, your wife will be primarily responsible to pay Zakat on her Zakatable assets such as gold and silver. However, you may pay Zakat on her behalf.

208. Can Zakat be paid in kind?

Zakat can be paid in kind according to the Hanafi school, whilst other schools either reject this entirely or allow it in some circumstances and not others or allow it with a degree of reprehensibility .

If a person pays Zakat in kind, he must ensure he valuates the assets correctly to cover his Zakat liability. Thus, a person may pay Zakat by giving their belongings such as a laptop, mobile phone etc., however, one must accurately determine the current market value of the item to ensure the Zakat liability is covered.

209. wanted to know if i can give my Zakat in the form of ready-made clothes instead of giving cash?

Zakat can be given in the form of ready-made clothes. You just need to ensure that the monetary value of the clothes covers your Zakat liability.

210. Can I pay Zakat in other forms other than cash?

Zakat can be paid in kind according to the Hanafi school, whilst other schools either reject this entirely or allow it in some circumstances and not others or allow it with a degree of reprehensibility .

If a person pays Zakat in kind, he must ensure he valuates the assets correctly to cover his Zakat liability. Thus, a person may pay Zakat by giving their belongings such as a laptop, mobile phone etc., however, one must accurately determine the current market value of the item to ensure the Zakat liability is covered.

211. Can I split my Zakat to different people?

It is permissible to split one’s Zakat payment to a number of people.

212. Can my Zakat be paid to one person?

Zakat can be paid all to one eligible person. However, it is discouraged to give such a person more than that is required to the extent he beomces wealthy.

213. Is it necessary to find out if a person is eligible to receive Zakat before giving Zakat?

One should carry out some form of due diligence and assessment in determining the eligibility of a Zakat recipient. If there is doubt or a strong assumption that the person is not eligible to receive Zakat, Zakat should not be given to such a person.

214. What if I realised after I gave my Zakat to a person that he was not eligible?

If a person tried their best in determining the eligiblity of the recipient and then paid Zakat, the Zakat will be valid even if it transpired that the person was ineligible. This is because the payer did all that they could in determining the eligibility.

215. Is it necessary to tell the person you are giving Zakat to that it is Zakat?

It is not necessary to tell the Zakat recipient that the wealth is Zakat. It is permissible to call the payment a gift.

216. Is it permissible to call the Zakat money a gift?

It is permissible to tell the Zakat recipient that the payment is a gift.

217. Who can receive Zakat?

The recipients of Zakat have not been left to the limited wisdom of mankind, rather to the limitless wisdom of Allah. The following verse outlines the recipients:

“Sadaqah (Zakat) is for the poor and for the needy and for those employed to collect [Zakat] and for bringing hearts together [for Islam] and for freeing captives [or slaves] and for those in debt and for the cause of Allah and for the [stranded] traveller – an obligation [imposed] by Allah. And Allah is Knowing and Wise.” (Quran 9:60)

The above verse singles out eight types of people deemed eligible to receive Zakat. They have been identified as:

1. Al-Fuqara’ (The poor)
2. Al-Masakin (The needy)
3. Al-‘Amilina ‘Alayha (Administrators of Zakat)
4. Al-Mu’allafah Qulubuhum (Reconciliation of Hearts)
5. Fir-Riqab (those in Bondage)
6. Al-Gharimin (Those in Debt)
7. Fi-Sabilillah (In the Cause of Allah)
8. Ibn al-Sabil (The Wayfarer)

218. What are the categories of Zakat?

The recipients of Zakat have not been left to the limited wisdom of mankind, rather to the limitless wisdom of Allah. The following verse outlines the recipients:

“Sadaqah (Zakat) is for the poor and for the needy and for those employed to collect [Zakat] and for bringing hearts together [for Islam] and for freeing captives [or slaves] and for those in debt and for the cause of Allah and for the [stranded] traveller – an obligation [imposed] by Allah. And Allah is Knowing and Wise.” (Quran 9:60)

The above verse singles out eight types of people deemed eligible to receive Zakat. They have been identified as:

1. Al-Fuqara’ (The poor)
2. Al-Masakin (The needy)
3. Al-‘Amilina ‘Alayha (Administrators of Zakat)
4. Al-Mu’allafah Qulubuhum (Reconciliation of Hearts)
5. Fir-Riqab (those in Bondage)
6. Al-Gharimin (Those in Debt)
7. Fi-Sabilillah (In the Cause of Allah)
8. Ibn al-Sabil (The Wayfarer)

219. What are the themes in the categories of Zakat?

The categories of Zakat can be divided into three categories considering the purpose which they serve:

1. Poverty relief and economic empowerment – this incorporates the first (the poor), second (the needy), fifth (those in bondage), sixth (those in debt) and eighth (travellers in need) categories of Zakat.
2. Causes for Islam – this incorporates category four (those whose hearts need winning over) and category seven (for the cause of Allah) of Zakat distribution.
3. Zakat management – this incorporates category three (administrators of Zakat)

220. Have scholars ever divided the categories of Zakat into themes?

Classical scholars have divided the meta-categories for different reasons. For example, Ibn al-Munayyir (d.733 AH) categorised the categories into two based on the conjunction Lam and Fi. Ibn Qudamah (620 AH) divided the meta-categories of Zakat into two based on Zakat distribution being revocable or not. Ibn Taymiyyah (d.728 AH) divided the meta-categories into two in relation to why Zakat was being distributed: for the individual needs or for the needs of the Muslim community as a whole .

221. Who are the al-Fuqara?

al-Fuqara are the first category mentioned in the Quran 9:60 as one of the eligible recipients of Zakat. Al-Fuqara literally means: the poor. This category is defined as those who are poor and require immediate relief and essentials.

222. What is the reason behind giving Zakat to the al-Fuqara (the poor)?

Allah has mentioned two categories of al-Fuqara’ and al-Masakin, which are generally conflated and considered as one. But why has Allah mentioned two? What might we extrapolate considering the intent of Allah? On the face of it, defining both meta-categories according to the majority, the meta-category of al-Fuqara’ seeks to serve those in absolute poverty, those who find little to meet their daily requirements and establish the core essentials, helping them to achieve basic survival from day to day. It allows for a standard of living that subsequently facilitates the next stage, al-Masakin. Giving Zakat to the poor will not necessarily lift them out of relative poverty but seeks to overcome abject poverty so as to meet basic human needs and afford some level of stability, at least enough that will then lead to ways in which the deprived and socially excluded can access economic opportunities.
Poverty is the most common and widespread impediment. Thus, the meta-category of al-Fuqara’ first speaks to the importance of having basic human needs met, not only for raising GDP or resourcing capital, but also to facilitate Allah consciousness.

223. Who are the al-Masakin?

al-Masakin are the second category of Zakat mentioned in the Quran 9:60 as one of the eligible recipients of Zakat. Al-Masakin literally means: the needy. This category refers to those who are not self-sufficient and needy despite having some provision.

224. What is the reason behind giving Zakat to the al-Masakin (the needy)?

As for al-Masakin, it is a meta-category which focuses on empowering those struggling in some form of poverty, affording them access to opportunities that lift them out of poverty and enable them to raise standards relative to their basic needs. It ensures that the basic necessities are met, gets the poor into work, or affords them access to capital that they can use for private enterprise. Hence, this meta-category looks at the poor from the perspective of societal contribution, seeking to lift them out of general poverty and afford them access to opportunities conducive to overall economic growth. This meta-category facilitates a reasonable surplus in one’s budget, allowing one to contribute to society as a Zakat payer.

225. What is the poverty line in Shariah?

The Hanafi school have used the Zakat Nisab as the margin and threshold to distinguish between the poor and wealthy. Therefore, a poor person is one who does not own any Zakatable assets nor surplus assets which equates to the Nisab.
The Maliki, Shafi’i and Hanbali schools have not used the Zakat Nisab to distinguish between poverty and affluence as far as receiving Zakat is concerned, rather they have made Kifāyah (sufficiency) the distinguishing factor. Therefore, whoever possesses sufficient wealth and assets for himself and his dependents for a given period is wealthy. Whoever does not own sufficient money and assets for himself and his dependents for a given period can receive Zakat according to this opinion.
The Maliki, Shafi’i and Hanbali school differ in the timeframe to assess sufficiency. The Maliki and Hanbali school have a timeframe of one year. So, a needy person is he who does not currently own and possess sufficient essentials of life to get him through the next 12 months. The Shafi’i school have a broader understanding of sufficiency and consider life expectancy, geographical location and other variables when calculating what is sufficient for a person .

226. What does Kifayah mean in the context of Zakat?

The Maliki, Shafi’i and Hanbali schools have not used the Zakat Nisab to distinguish between poverty and affluence as far as receiving Zakat is concerned, rather they have made Kifayah (sufficiency) the distinguishing factor. Therefore, whoever possesses sufficient wealth and assets for himself and his dependents for essential needs for a given period is wealthy. Whoever does not own sufficient money and assets for himself and his dependents for a given period can receive Zakat according to this opinion.

Needs considered under the Kifayah framework Food, clothing, accommodation, transport and utilities for applicant and his dependents.
If there are any other essentials required by an applicant, that can be considered on a case by case basis.
Eligible recipients under Kifayah:
1. The applicant has no funds for his needs
2. The applicant has insufficient funds for his and his dependents’ needs
3. The applicant has a job but not sufficient to cover his basic costs
4. The applicant has a source of income or someone providing for him but does not cover his costs
5. The applicant has some funds but insufficient for his needs
6. The applicant has insufficient funds to cover his necessary expenses for the forthcoming year.

The Maliki, Shafi’i and Hanbali school differ in the timeframe to assess sufficiency. The Maliki and Hanbali school have a timeframe of one year. So, a needy person is he who does not currently own and possess sufficient essentials of life to get him through the next twelve months. The Shafi’i school have a broader understanding of sufficiency and consider life expectancy, geographical location and other variables when calculating what is sufficient for a person.

227. How is a poor and rich person distinguished for Zakat purposes?

The Hanafi school have used the Zakat Nisab as the margin and threshold to distinguish between the poor and wealthy. Therefore, a poor person is one who does not own any Zakatable assets nor surplus assets which equates to the Nisab.

The Maliki, Shafi’i and Hanbali schools have not used the Zakat Nisab to distinguish between poverty and affluence, rather, they have made Kifāyah (sufficient provisions) the distinguishing factor. Therefore, whoever possesses sufficient wealth and assets for himself and his dependents is wealthy. Whoever does not own sufficient money and assets for himself and his dependents is poor.

The Hanbali school has a second opinion which states that if a person has the equivalent of 50 dirhams, he is considered wealthy even if it is not sufficient for him.

228. What is the difference between al-Fuqara and al-Masakin?

Scholars have different opinions on the differences between al-Fuqara and al-Masakin. They can be summarised in the following points:

1. A person who has absolutely nothing in terms of wealth and assets is from the al-Masakin. Whereas, a person who has some wealth but less than sufficiency or less than Nisab is from the al-Fuqara’.
2. Those who have more than half of their essentials in terms of money and assets are regarded as al-Masakin. Whereas, those who own less than half are from al-Fuqara’.
3. Those whose economic state is worse than the needy .

229. Who are the Amilin alayha?

Amilin alayha are the third category of Zakat in the Quran (9:60). It refers to the administrators of Zakat.

230. What is the reason behind giving Zakat to the al-Amilin Alayha (the administrators of Zakat)?

Funding is the key to all endeavours. To progress and increase efficiency, there are always costs involved. To keep services to Zakat payers and Zakat recipients at an optimal level and in line with the context and culture they live in, it is imperative to keep updating and improving operations. Hence, it is of no surprise that Allah Himself has permitted the Zakat administrators to receive Zakat as a wage. This is self-sustainability and efficiency in establishing this pillar of Islam.

231. Is the Zakat given to pay the wages of administrators of zakat considered as a wage or as Zakat?

In Bada’i al-Sana’i, Imam al-Kasani (d.587 H) states that the Zakat paid to the Amil is not purely Zakat, rather, it is an `imalah (commission) with a quasi-status; it is like Zakat from one angle and ‘Ujrah (wage) from another angle. In al-Jawharah al-Nayyirah, Imam al-Zabidi (d.800 H) has reiterated the same understanding. Due to the wages (‘Imalah) having a legal (hukmi) angle of Zakat in it, Imam al-Shurunbulali states that a Hashimi (family member of the dear Prophet) cannot take this directly. Likewise, from the other angle of it being like a wage, it is permissible for a wealthy person to receive it. The commission was not entirely a wage nor a salary as the hours and amount received were unknown and thus could not be a valid Ijarah contract. The pay was dependent on what was collected and the services rendered. The payment was a commission from the Fuqara’ to Al-‘Amilina ‘Alayha. Upon the Amil taking possession, Zakat was paid and discharged from the payers’ liability. Thereafter, the ‘Amil took his commission as an ‘Imalah and not directly as pure Zakat as mentioned by Imam al-Shurunbulali. Hence, Imam al-Kharkhi (d.340 H), Imam al-Tahawi (d.321 H) and Imam al-Jassas (d.370 H) state that the commission has an element (shubhah) of Zakat as the commission is taken from the Zakat funds, and the shubhah is only treated as reality (haqiqah) in respect to a Hashimi.

The ‘Amilina ‘Alayha were paid from the Zakat funds because they occupied themselves to serve the Fuqara’, hence, they deserved to be paid for the service they are providing. It was a payment from the wealth collected for the Fuqara’ to the ‘Amilina ‘Alayha as they provided them this core and vital service.
The above demonstrates that the real relationship exists between the ‘Amilina ‘Alayha and the Fuqara’ they represent and serve. If an organisation can construct a similar relationship in today’s context without an Imam, the service providers can potentially be ‘Amilina ‘Alayha.

232. Are Zakat administrators specific to workers in an Islamic government?

The Zakat collectors (Amilin ‘alayha) were historically a government department. The entire Zakat collection and distribution was an organised governmental function. Mufti Khalid Saifullah states that the reason behind the Shari’ah giving the Imam the right of Zakat collection was a to have a centralised, organised institution of Zakat collection and distribution. He argues that in the absence of such a framework, if an institution endeavours to offer the services of Zakat collection and distribution, they can be considered as Al-‘Amilin ‘alayha. Other contemporary scholars from across the world have voiced a similar opinion. Therefore, any institution which offers a focused Zakat collection and distribution service can be considered as Amilin ‘alayha.

233. What were the roles and departments in the administrators of Zakat?

Shaykh Wahbah al-Zuhayli (may Allah have mercy upon him) and others have enumerated the following roles as part of Al-‘Amilina ‘Alayha:
1. Al-Sa’i (Zakat collector) – primarily responsible for Zakat collection on animal livestock
2. Al-‘Ashir (Zakat collector)– Zakat collectors from traders, merchants, businessmen and travellers passing by their Zakat offices.
3. Al-Katib (The accountant) – He would document payments and deal with receipts.
4. Qasim al-Zakat (distributer of Zakat) – These were caseworkers who would allocate Zakat funds to recipients.
5. Hafiz al-Mal (guardian of Zakat funds) – These were people entrusted in protecting the wealth gathered in Zakat.
6. Al-Kharis (Stock valuer) – These were officials who would perform stock takes.
7. Al-Hasib (Zakat calculator) – These officials would assist in calculating Zakat payments

234. What does al-Gharimin mean?

Al-Gharimin is the fifth category of Zakat recipients mentioned in the Quran (9:60). This category refers to those who are indebted and require support for debt relief.

235. Who does al-Gharimin refer to?

According to the jurists, the following three types of people can be helped under al-Gharimin :
a. Whoever has a debt due to his personal needs
b. Whoever takes a debt for societal needs such as mediating, arbitrating or reconciling between people
c. Whoever acts as a guarantor
The Shafi’i school further permitted the paying of Zakat to any person who took on a financial burden to quell rife and discord between communities.

236. What is the eligibility criterion to help someone in debt?

The Hanafi school permit the payment of Zakat to any person whose liabilities exceed his Zakatable and surplus assets. Such a person is in debt. Other schools of Islamic law consider the eligibility based on the Kifayah criteria where a person would need to prove that they have entered into a financial agreement which they cannot fulfil and has indebted them, burdening them in such a way (thoroughly monthly repayments/charges) that they are unable to finance their most basic needs.

237. When giving Zakat to a debtor, does it have to be given to him in their hand or can be paid to the creditor directly?

It is not necessary to give the Zakat in his hand. Zakat can be given to the creditor on behalf of the debtor with the latter’s acknowledgement.

238. What does the category al-Riqab refer to?

In the medieval era, slavery was commonly practiced. Islam encouraged an end to slavery and granting humans freedom and self-ownership. Thus, Zakat was permitted to be used to free Muslims in slavery, captivity or bondage. Classical scholars enumerate the following types of people under this category:

1. Slaves whose freedom was conditional on a payment.

The slaves were required to buy themselves out of slavery by paying their master an agreed amount. Zakat was used to assist such Muslim slaves to pay off the debt owed to the master .

2. Normal slaves

Some scholars permitted the purchasing of normal slaves outright from Zakat funds. In order to free them from Slavery.

3. A Muslim prisoner

The Hanbali school have expressly permitted the paying of Zakat to help free Muslim inmates and captives .

Contemporary scholars have debated contemporary applications of this category of Zakat. The idea is that this category revolves around physical constraints which prevent freedom for individuals. Modern slavery and human trafficking are two contemporary examples of this category.

239. What was the reason behing giving Zakat to al-Riqab?

This meta-category targets the ill of oppressive commodification of man. The objective is to restore the liberty and independence of a human being, empower him to give himself in the servitude and submission to Allah alone.
In our context, the identical form of slavery does not exist. This begs the question, is this metacategory exclusive to a person who was subjected to a specific process in a specific context? Or, is this meta-category a description and a marker for all those subjugated to exploitation, physical, socio-legal constraints and who have lost their liberty? The fact that some jurists – like the Hanbali jurists – have considered prisoners to fall under Fir Riqab highlights that there are other implications to this meta-category. But what type of liberty is the point of consideration here, and does it extend beyond the physical? The existence of the meta-categories concerning those in debt (the gharimin) indicates that there is more than one meta-category that deals with freedom, with ‘those in debt’ addressing constraints owing to financial obligations. Hence it seems that this meta-category specifically deals with physically constraining situations (by external entities) that hinders society-impacting productivity. The idea and notion of enslavement has mutated and involved into other forms. There are people out there who are constrained physical, socio-legal constraints. Human trafficking, modern slavery (as discussed in the Modern Slavery Act 2015), Muslim prisoners imprisoned unjustly, are just a few examples of people in some form of physical, socio-legal constraints. This metacategory surely requires exploration to see if the elements underpinning Fir Riqab are manifest today.

240. What does Ibn Sabil (travellers in need) mean?

A wayfarer refers to a person who does not have access to his funds despite being wealthy. He/she has been left stranded and in an emergency. Ibn al-Sabil literally means ‘the son of the road’.
In the Arabic language, Ibn (son) is figuratively used to denote attachment and belonging. Thus, Ibn al-Sabil is a person who has become dislodged and temporarily anchored to the roads in an emergency.

241. What is the reason behind giving Zakat to the ibn al-Sabil (the traveller in need)?

Prima facie, this meta-category equates to emergency funds for those stranded in a foreign land, having lost the means to return home. Ibn al-Humam (d.861 AH) discusses how a resident who is stranded also all falls under the purview of this meta-category104. The ibn al-Sabil is therefore a person who is stranded in a temporary emergency. They are not in their optimal state. This sudden state has left them at the mercy of come what may. Zakat is an emergency response to aid such a person. Zakat is used to empower such an individual and get them to their optimal state again. Of course, it is important that we highlight how this serves the collective. Aiding travellers back to their domicile helps them to return back to contributing to their societies and uplifting their communities. Additionally, it serves to undermine destitution where stranded individuals require far more resources from the community in the long run. Where we consider this meta-category to represent emergency funds, including for those domicile within the country, it is reasonable to assert that the communal benefit comes in the shape of returning the state of citizens back to normality where markets function normally, society recovers from the instability, and public revenue continues to be generated.

242. What does the category al-Mu'allafati Qulubuhum (winning hearts) mean?

Ibn Ashur (d.1393 AH) states that Al-Mu’allafati Qulubuhum’ refers to creating positive perceptions, feelings and inclinations towards Islam and Muslims. Imam Raghib al-Asfahani (d.502 AH) states that Ta’lif linguistically refers to assembling scattered things. In the context of Zakat, it refers to those with negative or neutral perceptions about Islam and Muslims, and enabling them to think more positively towards Islam and Muslims.

243. Why is Zakat given to winning hearts?

This meta-category is considered to be ‘soft power’. Soft power in political theory refers to the ability to influence and persuade without force and coercion. Influence under soft power is achieved by building networks and communicating compelling narratives. The result is Tamkin (firm establishment), influence and power. This gives rise to greater stability and selfdetermination.
The categories subsumed by this meta-category can include: indiviuals helping the wider community to have more positive perceptions of Islam and Muslims; those who may pose harm to Muslims; and those new to the faith in order to deepen their sense of belonging and commitment. In the context of Muslim-minority communities, this meta-category presents primarily as constructive social and political engagement with the aim of achieving a more conducive environment for Muslims to practise their faith.

244. Who was given Zakat under the category of 'winning hearts'?

In their historical contexts, scholars interpreted this category as follows:

Imam al-Babirti (d.786 AH) stated the following types of people as beneficiaries:
1. Those who were inclined to accepting Islam.
2. Those who opposed Muslims and were considered a threat.
3. Those who had just embraced Islam70.

Ibn Qudama (d.620 AH) described the beneficiaries of this meta-category as follows:

1. Muslims
a. Muslim leaders whose faith was shaky could be given zakat in this meta-category. Such individuals may have great influence on Muslims, and giving to them generously could strengthen their faith and commitment. An example is the Makkans who were given generously by the Prophet ` after the battle of Hunain.
b. Prominent Muslims whose social status was respected by those who were not Muslim who have status in their own communities. It is considered that Sayyiduna Abu Bakr’s giving to Adi bin Hatim and al Zibriqan bin Badr, who were obviously committed Muslims, was of this nature.
c. Muslims who strove to defend Muslims against hostile narratives.
d. Muslims whose influence was needed in the Zakat collecting process to persuade others to pay their Zakat. This was a soft approach to change hearts and minds.

2. Those of other faiths or none
a. Individuals who were close to becoming Muslims, or whose clans may have become Muslim.
b. Those who may have done harm to Muslims, to whom giving Zakat would stop them from hurting Muslims. Ibn ‘Abbas narrates that certain people came to the Prophet who, if they were given Sadaqat, would praise Islam and declare it a good religion but, if they were not, would malign Islam.
Imam al-Nawawi (d.676 AH) describes al-Mu’allafati Qulubuhum with similar beneficiaries in al-Majmu’.

245. Is the category of 'Winning Hearts' still applicable?

According to the Maliki, Shafi’i and Hanbali schools, this meta-category is a valid avenue for Zakat distribution.
Among the Hanafi scholars, there is a difference of opinion in respect to this meta-category. Some Hanafi jurists have suggested this category has been abrogated whilst others have clearly stated that this meta-category is not abrogated, but that it is dependent on the existence of an ‘illa (effective legal cause) . Imam al-Zayla’i (d.743 AH) states that it is not abrogated, rather it is not practised if the circumstances do not require it . Ibn Nujaym (d.970 AH) states in al-‘Inayah that the preferred opinion is that it is not abrogated . In Kashf al-Asrar, it is also stated that the ‘illa was absent as opposed to being abrogated . Maulana Abdul Hayy al-Laknawi (d.1304 AH) states that this category is not abrogated, rather, the ‘illa was not present . This can obviously be understood in the context of these jurists who wrote, researched and lived in a polity of Muslims where Islam was well-established. In respect to the Ijtihad of Sayyiduna ‘Umar (may Allah be pleased with him) regarding this meta-category, Ibn Abidin (d.1252 AH) and others state the underlying reason for this meta-category was no longer there in his time. The meta-category existed to serve Islam in a certain context. That context ceased to exist and, as a result, he abandoned the use of this meta-category. Islam had reached a height whereby people were drawn to Islam by its grandeur and reputation . This appealed and reconciled hearts more than any wealth could.
There was no need to soften the stance towards Islam. Thus, there was no longer a need to apply this meta-category to appeal to converts or those of other faiths and none. People themselves were positive about Islam and the Muslims without having to fund such initiatives.
According to the majority of scholars, this meta-category is still functional and not limited to a specific context; rather, it can be used to support the flourishing of Islam when required.

246. What were the reasons for giving Zakat to 'al-Mu'allafati Qulubuhum'?

The following points highlight the reasons and circumstances in which this meta-category can be used:
1. Islam and Muslims are maligned and misunderstood in society.
Ta’lif with Zakat is permitted and encouraged in any society where Islam and Muslims are maligned and considered negatively.
2. If Ta’lif with Zakat funds can boost the reputation of Islam and Muslims.
Ta’lif al-Qulub is a means of giving Islam and the Muslims a good reputation among the people. That is why Sayyiduna Umar stopped using this meta-category as it would have had no considerable increase in the reputation of Islam nor the Muslims as their status had been well-established.
3. As a strategy to strengthen Muslims.
The Muslims’ weakness is another factor prompting the application of this meta-category. Muslims being weak suggests that they are vulnerable, defenceless, helpless, unprotected and ineffective. When Muslims had influence, there was no need to use this meta-category anymore. This is precisely why this meta-category was not used in the time of Sayyiduna Umar. However, when Muslims are the weaker ones in society, this meta-category can be considered to be useful.
Weakness is to do with a lack of power and influence regardless of numbers. Strength gives one the ability to navigate proceedings of any given matter in one’s best interests.
These concepts are defined, understood and tangible considering the factors of one’s ‘Urf (custom). For this meta-category to be meaningful today, the application of this metacategory must consider how strength is gained in one’s context and ‘Urf.
4. When Muslims are a weak minority.
Muslims being a weak minority is another factor underpinning the use of Ta’lif. A weak minority needs to use Ta’lif to boost its reputation and bring hearts together. When Sayyiduna Umar (May Allah be pleased with him) halted the use of this meta-category, he did so because Muslims were the majority in the region and were influential.
5. As a last resort when other means are unavailable.
Imam al-Jassas (d.370 AH) states84 that Ta’lif al-Qulub is an option to gain currency and recognition when there is a lack of alternative strategies or options. It is a pre-emptive measure when more proactive measures are not possible.
6. A means of securing the faith of new converts. Mu’allafatul Qulub is a means of bringing stability to new members of the faith community.
7. When Islam is weak in the hearts of Muslims.
When the faith of Muslims is weak, Mua’llafatul Qulub is a mechanism to strengthen them and keep them committed to faith.

247. What does the category Fisabilillah mean?

The seventh meta-category of Zakat distribution is expressed in the Qur’an as “Fi-Sabilillah” [in the way of Allah]. To whom is this share of Zakat paid? “Sabil” means way, and “sabil Allah” is the way that leads to pleasing Allah. Ibn al Athir says that ‘sabil Allah’ is general enough to cover every action or deed sincerely intended for the sake of Allah, including fulfilling religious obligations and voluntary worships and deeds. He notes that Fi-Sabilillah usually means Jihad (striving for the sake of Allah), so the term often appears to be restricted to the meaning of Jihad.

This analysis of the term Fi-Sabilillah by Ibn al-Athir (d.630 AH) shows two important points:
1. The term originally means every action intended solely to serve the cause of Allah, including all good deeds, individual and collective.
2. The term is commonly understood to mean striving for the sake of Allah, since the frequency of its usage would suggest a restricted meaning of striving for the sake of Allah

248. What is the evidence that scholars can be supported under the category Fisabilillah?

The resolution passed by Islamic Fiqh Academy (Majma al-Fiqh al-Islami), which has over 60 leading Ulama from different countries in the world passed a resolution on the inclusion of Da’wah and students of knowledge in the category of Fisabilillah.

249. Can I give my Zakat to my husband?

There is a difference of opinion among the scholars with respect to the wife giving Zakat to her needy husband. The Hanafi school is of the opinion it is not permitted whilst the Shafi’i school permit it.

250. Can I give my Zakat to my wife?

Ibn Qudamah says there is a consensus among scholars that a husband cannot give Zakat to his wife. The Hanafi and Hanbali school maintain that the Zakat payer will indirectly benefit from his Zakat.

The Maliki and Shafi’i school state that a husband cannot give Zakat to his wife as he must financially maintain her with other funds.

251. Can I give Zakat to my children?

The Hanafi and Hanbali schools prohibit giving Zakat to one’s parents or children as the Zakat payer will be indirectly benefit from his Zakat. Thus, it is akin to using Zakat for oneself.

The Maliki and Shafi’i scholars prohibit giving Zakat to all those people whom the Zakat payer is obliged to maintain financially. This includes parents and children.

252. Can I give Zakat to my step children?

According to the Hanafi school, Zakat can be given to one’s step children.

253. Can I give Zakat to my grand children?

According to the Hanafi school, Zakat cannot be given to one’s grandchildren.

254. Can I give Zakat to my neice?

It is permissible to give Zakat to one’s needy neice.

255. Can I give Zakat to my nephew?

It is permissible to give Zakat to one’s needy nephew.

256. Can I give Zakat to my parents?

The Hanafi and Hanbali schools prohibit giving Zakat to one’s parents or children as the Zakat payer will be indirectly benefit from his Zakat. Thus, it is akin to using Zakat for oneself .

The Maliki and Shafi’i scholars prohibit giving Zakat to all those people whom the Zakat payer is obliged to maintain financially. This includes parents and children.

257. Can I give Zakat to my mother?

The Hanafi and Hanbali schools prohibit giving Zakat to one’s mother. The Maliki and Shafi’i scholars prohibit giving Zakat to all those people whom the Zakat payer is obliged to maintain financially. This includes one’s mother.

258. Can I give Zakat to my father?

The Hanafi and Hanbali schools prohibit giving Zakat to one’s father. The Maliki and Shafi’i scholars prohibit giving Zakat to all those people whom the Zakat payer is obliged to maintain financially. This includes one’s father.

259. Can I give Zakat to my grand parents?

It is not permissible to give one’s Zakat to one’s grandparents. They should be assisted and looked after through other payments.

260. It is permissible to give Zakat to one's needy uncle.

It is permissible to give Zakat to one’s needy uncle.

261. Can I give Zakat to my aunty?

It is permissible to give Zakat to one’s needy aunt.

262. Can I give my Zakat to my neighbour?

It is permissible to give Zakat to a Muslim neighbour who is eligible for Zakat.

263. Can I give my Zakat to my brother?

It is permissible to give Zakat to one’s needy brother who qualifies for Zakat.

264. Can I give my Zakat to my sister?

It is permissible to give Zakat to one’s needy sister who qualifies for Zakat.

264. Can I give my Zakat to my stepbrother?

It is permissible to give Zakat to one’s needy step-brother who qualifies for Zakat.

265. Can I give my Zakat to my step sister?

It is permissible to give Zakat to one’s needy step-sister who qualifies for Zakat.

266. Can I give my Zakat to a colleague at work?

It is permissible to give Zakat to one’s needy colleague at work.

267. Can I give my Zakat to a friend of mine?

It is permissible to give Zakat to one’s friend who is eligible to receive Zakat.

268. Can I waive off a debt as Zakat?

A debt cannot be waived off as Zakat.

269. What are some examples where Zakat can be miscalculated?

A person can have missed Zakat in a number of different circumstances. Some of the possible scenarios include:

• As a teenager, you may have had enough money in your bank account to warrant paying Zakat but not thought about it.
• As a student at university or upon graduation, you may have incorrectly assumed that you didn’t have to pay Zakat due to having a student loan.
• You may have been unsure whether to pay Zakat on jewellery or not.
• You may not have distinguished between personal and business assets correctly.
• You may have been confused about paying Zakat on your pension.
• You and your spouse may have been calculating Zakat as a couple rather than individually.

270. What is missed Zakat?

Missed Zakat refers to unpaid Zakat after being binding upon someone. The failure to pay Zakat on its due date means one has missed and defaulted in a Zakat payment.

271. What if I missed a number of years of Zakat?

A person who missed Zakat a number of years has to calculate the value of the net Zakatable assets on one’s Zakat day for every year missed.

The amount to be disbursed in the previous years has become a debt in one’s liability on the day Zakat was binding. Thus, the outstanding amount due on each year’s Zakat day must be paid.

272. How do I calculate missed Zakat?

To calculate missed Zakat, work out the total net Zakatable assets in previous annual Zakat days in the same manner when calculating your net Zakatable assets for the current year. You can work out your net Zakatable assets by subtracting all your deductible liabilities from your gross Zakatable assets.

One should try to calculate as precise and accurate as possible. To get a precise figure, one can look at previous bank statements, wage slips, invoices, receivables and other documentation related to investments.

273. Can I pay missed Zakat in instalments?

If a person genuinely does not have the financial capacity to pay off the entire missed Zakat balance immediately, it will be permissible to pay off the outstanding missed Zakat balance in instalments.

274. How can I have missed Zakat?

One can miss Zakat payments intentionally or unintentionally for a number of reasons:

• Forgetting Zakat altogether
• Miscalculating Zakat and as a result not paying at all or paying less than what was due
• Being lazy and missing Zakat
• Saving money to purchase something deemed important

275. Does a deceased person have to pay missed Zakat?

The majority of the schools of Fiqh, namely, the Maliki, Shafi’i and Hanbali schools stance on missed Zakat for a deceased person is that Zakat must be paid from the estate when paying off any debts. Zakat will be disbursed from the estate even without a bequest for the payment of Zakat.

The Hanafi school opines that missed Zakat will not be paid from the estate unless the deceased had bequeathed the payment of Zakat. If he did enumerate missed Zakat in his bequest, Zakat will be paid from one-third of his estate after deducting funeral costs and liabilities.

276. Does Zakat become a debt?

When a person misses a payment of Zakat, the outstanding balance becomes a debt. A Zakat debt is more severe than normal debts. A normal debt is the right of the creditor who may be wealthy and affluent. Whereas, a Zakat debt has two rights attached to it; not only is it the right of a needy person, in addition, it is the right of Allah that one pays his Zakat.

277. Is there any additional fine or monetary penalty for missing Zakat?

There is no additional fine or penalty for failure to disburse Zakat on time. Instead, one should hasten to pay any outstanding Zakat immediately and equally, seek repentance from Allah.

278. Is missing Zakat a sin?

If a person missed a Zakat payment despite having the ability to pay their Zakat, such a person will be considered sinful.

Once a command of Allah applies to a person, to delay without any genuine justification is regarded as a sin.

Imam Al-Nawawi (may Allah have mercy on him) said: “Our scholars (the Shafi’I scholars) agree that when Zakat becomes binding upon an individual who has ability to pay, he must give immediately. Delaying the payment of Zakat will make him sinful. This is also the view of Imam Malik, Imam Ahmad and the majority of scholars. Our evidence is the words of Allah, may He be exalted:
“And give Zakat” (Qur’an 2:43). This command implies that is to be paid immediately. (al-Majmu’ Sharh al-Muhadhdhab 5/335)

279. Does missed Zakat remain obligatory?

Missed Zakat becomes obligatory after a person qualifies to pay Zakat. This obligation remains upon a person despite negligence, error or ignorance.

The obligation of Zakat according to the Hanafi School is originally upon the wealth but is transferred onto an individual upon exhausting his wealth. Whereas, the other schools of Fiqh opine that the obligation of Zakat is vested on an individual from the outset. Thus, it remains obligatory.

280. Who is obliged to pay missed Zakat?

Those who are required to pay Zakat are equally required to pay missed Zakat for those years which they qualified to pay Zakat but failed to do so. At the time of missing a Zakat payment, those required to pay missed Zakat must be:

• Adult (have reached puberty)
• Muslim
• Sane
• In complete ownership of the Nisab (Add link for info)

Please note, the three schools of thought other than the Hanafi school state that Zakat should be paid on qualifying wealth owned by the insane and children.

281. Are there any scenarios where missed Zakat is overlooked and forgiven?

Zakat liability drops upon the loss of one’s wealth due to factors out of one’s control such as fires, floods, theft etc. However, Zakat liability will only drop if these unfortunate events occurred without spending one’s money. Realistically, if these events occurred on one’s Zakat date or immediately after without using any of the funds, Zakat liability will be overlooked. This is the Hanafi school’s opinion.

For example, the Nisab was £200 and on the Zakat anniversary, Musa had £200. A day later, a spontaneous fire burnt the £200 worth of notes he had. In such a scenario, since the actual Nisab he held has been destroyed without his wrong doing, foul play or without spending, the Zakat liability will drop completely as the actual Nisab and savings is no longer present.

This ruling is according to the Hanafi school who opine that Zakat liability is initially on the actual wealth itself rather than the liability of a person. Only after using the funds does the Zakat liability move onto oneself from the wealth. Thereafter, the Zakat remains a debt on the person.

However, according to the majority of schools of Fiqh, namely, the Maliki, Shafi’i and Hanbali schools, the Zakat liability is upon the individual from the outset. Therefore, a missed Zakat payment will not be written off upon the destruction of wealth on condition one had the ability to pay and did not paid.

282. How do I calculate missed Zakat to ensure I have fulfilled this obligation?

To calculate missed Zakat, work out the total net Zakatable assets in previous annual Zakat days in the same manner when calculating your net Zakatable assets for the current year. You can work out your net Zakatable assets by subtracting all your deductible liabilities from your gross Zakatable assets.

One should try to calculate as precise and accurate as possible. To get a precise figure, one can look at previous bank statements, wage slips, invoices, receivables and other documentation related to investments.

To obtain a Step by Step guide on calculating missed Zakat, visit https://zakat.ch/take-action/calculate-zakat/

283. Is the previous year’s missed Zakat deductible from the following year’s gross assets?

When calculating missed Zakat for a number of years, one may deduct all the outstanding zakat from the previous years from the following years. For example, the outstanding Zakat from the Islamic calendar years 1425-1435AH can be deducted when calculating one’s net Zakatable assets for 1436AH.

284. What if I missed a number of years of Zakat?

A person who missed Zakat a number of years has to calculate the value of the net Zakatable assets on one’s Zakat day for every year missed.

The amount to be disbursed in the previous years has become a debt in one’s liability on the day Zakat was binding. Thus, the outstanding amount due on each year’s Zakat day must be paid.

285. What if I do not know the date of my Zakat anniversary?

Your annual Zakat day will be the first time in life you owned wealth equalling the Nisab threshold. That Islamic date will be the annual date to pay Zakat.

If you cannot remember the date you first became owner of the Nisab, then the date should be estimated. If this is not possible, then a specific Islamic date should be selected arbitrarily and adhered to annually.

286. What if I have been paying random amounts of Zakat without calculating the exact amount due?

It is necessary to calculate Zakat correctly to ensure one is fulfilling this command of Allah properly. It is strongly encouraged that one reviews his accounts and finances for the previous years and the amount of Zakat disbursed. This will clarify if there is a deficit in payment. One can make amends thereafter.

287. I have been acquiring unlawful and Haram money for years. Do I have to pay missed Zakat for all these years?

First and foremost, one must repent for engaging in prohibited activities of trade. Zakat is not binding upon wealth acquired from haram sources like gambling, interest & sales of prohibited items. The total amount of money acquired from unlawful activities must be given all in charity.

Money acquired unlawfully belongs lawfully to the owners of the wealth. If they cannot be traced, one must dispense of such wealth in charity as that amount is not lawfully yours. Therefore, unlawful wealth is a liability which must be dispensed and will be deductible from one’s Zakatable assets for the missed year.

288. I have thousands of pounds of interest money from previous years. How does this affect missed Zakat?

The amount of interest acquired must be returned to wherever you received interest from. If that is not possible, the interest amount must be given in charity. This is a debt and liability upon you. Hence, when calculating Zakat, interest is a deductible from your gross Zakatable assets.

Money acquired unlawfully belongs lawfully to the owners of the wealth. If they cannot be traced, one must dispense of such wealth in charity as that amount is not lawfully yours. Therefore, unlawful wealth is a liability which must be dispensed and will be deductible from one’s Zakatable assets for the missed year.

289. Do I have to pay the entire outstanding balance of Zakat immediately?

The four mainstream schools of Islamic jurisprudence, namely, the Hanafi, Shafi’i, Maliki and Hanbali schools are in agreement that the payment of Zakat is due immediately upon becoming obligatory. Therefore, the outstanding Zakat amount must be paid immediately as a matter of urgency.

290. If I pay all of my outstanding Zakat immediately, I will need to take a loan and go into debt?

A realistic and genuine attempt must be made to disburse missed Zakat immediately. However, if one genuinely cannot pay the entire outstanding amount due to its large volume, one must pay as much as possible as quickly as possible. The outstanding amount can be divided into instalments.

In addition, it is necessary to write in your will that you have outstanding Zakat. It will be obligatory on the executor of the will to comply with this bequest. This bequest will be fulfilled from one-third of the estate after burial costs and debts as per the Hanafi school of Jurisprudence.

The Maliki, Shafi’i and Hanbali Schools of Jurisprudence state that a Zakat debt will be paid from the estate even if the deceased person did not bequeath it.

291. Is it necessary to give missed Zakat to a specific avenue or person?

The recipients of missed Zakat are identical to that of Zakat disbursed on time. When paying missed Zakat, pay as you normally pay for Zakat.

292. What if my spouse or mature children have missed Zakat, am I responsible to pay?

Zakat is an individual obligation. Thus, each spouse and mature child is individually responsible to disburse their own Zakat as well as their missed Zakat. However, one may help another disburse their zakat. Insha’Allah, one will get a lot of reward.

Please note the three schools of thought other than the Hanafi school state that Zakat should be paid on qualifying wealth owned by the insane and minor children.

293. Missed Zakat for a deceased person?

The majority of the schools of Fiqh, namely, the Maliki, Shafi’i and Hanbali schools stance on missed Zakat for a deceased person is that Zakat must be paid from the estate when paying off any debts. Zakat will be disbursed from the estate even without a bequest for the payment of Zakat.

The Hanafi school opines that missed Zakat will not be paid from the estate unless the deceased had bequeathed the payment of Zakat. If he did enumerate missed Zakat in his bequest, Zakat will be paid from one-third of his estate after deducting funeral costs and liabilities.

294. What if I missed Zakat for a number of years when I had a lot of money but now I am in debt?

Missed Zakat is still binding for the previous years despite being currently in debt. One may spread Zakat payments over a number of months in a genuine and realistic manner to fulfil this obligation at the earliest opportunity.

Current debt does not absolve one from missed Zakat from previous years. However, current debt will prevent the obligation of Zakat for this year. Current debt will not uplift missed Zakat of previous years as a person was capable to pay at that time. Thus, the obligation became vested in a person’s liability and remains until it is paid.

295. Does missed Zakat drop upon leaving Islam and re-embracing Islam?

The Hanafi and Maliki schools are of the opinion that leaving Islam erases all debts enjoined by Shari’ah including Zakat. However, the Shafi’i and Hanbali schools opine that these debts are not erased from one’s accountability, thus, a person who re-embraces Islam will still be liable to pay for the missed Zakat prior to leaving the fold of Islam.

296. Do I have to take into account the rate of inflation when paying missed Zakat?

The rate of inflation will not be considered when paying missed Zakat.

Inflation is not considered in Shariah based upon the following narration:

Abu Sa’id al-Khudri and Abu Huraira (Allah be pleased with them) narrate that the Messenger of Allah (Allah bless him & give him peace) appointed a person as a governor of Khaybar. This governor brought to the Prophet (Allah bless him & give him peace) high quality dates of Khaybar. The Messenger of Allah (Allah be pleased with them) asked: “Are all the dates of Khaybar like this?” He replied: “By Allah, no, O Messenger of Allah! We barter one measures (sa`) of this type of dates for two measures (sa`) of our own (normal & inferior quality) dates, and two measures (sa`)’s for three of ours. The Messenger of Allah said: “Do not do so (as this will be considered usury). Rather, sell the dates of inferior quality, and then buy the good quality dates with that money.” (Recorded by Imam al-Bukhari and Imam Muslim)

The Islamic jurists and Hadith commentators have explained that the above narration is clear evidence on the fact that when dealing in usurious goods, the similarity which is required is in quantity or equal units and not merely value. Therefore, one has to pay identical amount for missed Zakat in terms of units and numbers not value.

297. Will an outstanding Zakat debt be deductible when calculating my Zakat for this year?

Missed Zakat from previous years can be deducted when calculating one’s current Zakatable assets. A Zakat debt is a deductible liability for the current Zakat year on one’s Zakat anniversary.

Missed Zakat is treated as a liability which needs to be paid off immediately, hence, it is deductible.

298. Do I have to pay the Zakat debt first or can I pay money I owe to somebody else?

If the debt is deferred & payable later, then pay the missed Zakat first. However, if the debt is immediate or in the near future and it is feared that by paying missed Zakat you will not be able to pay the debt, it will be permissible to delay the missed Zakat payment. Make a firm intention to pay the missed Zakat as soon as you have the funds available.

The ideal situation would be to pay the missed Zakat from now in small amounts in instalments in a manner that will not affect the debt payment.

299. If I don’t pay an immediate bill, I will be charged interest. Shall I pay that bill off first or the missed Zakat?

One may pay off the outstanding bill. Thereafter, however much money is available, one should endeavour to use the remaining money for missed Zakat even if it does not cover all of the outstanding balance for missed Zakat.

The ideal situation would be to pay the missed Zakat from now in small amounts in instalments in a manner that will not affect the debt payment.

300. I haven’t paid Zakat on my gold for a number of years. Which rate do I consider if I am paying now? Today’s rate or the rate of gold in those years?

When paying for missed Zakat on gold, one will take into account the value of gold in the previous years. Hence, work out how much your gold was worth in the previous years on your Zakat day.

You may visit the following link to help calculate the value of your gold:
https://www.bullionbypost.co.uk/gold-price/gold-price-per-gram/

301. What if I missed paying Zakat only on my savings in my bank account?

Zakat is compulsory on all net Zakatable assets which includes all money, regardless if it is kept at home or deposited in a bank account. Thus, Zakat is also binding upon the amount one had in their bank account on their Zakat day. After tracing the balance of the bank account on their Zakat day, one can give 2.5% of bank balance as Zakat.

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