Zakat Calculator
Use this calculator to determine your Zakat obligation for the current lunar year. Zakat is 2.5% of your net Zakat-eligible wealth that has been held for a full lunar year (Hawl) and exceeds the Nisab threshold.
Your Assets
Enter the current value of your Zakat-eligible assets that have been in your possession for a full lunar year (Hawl).
Your Liabilities
Enter your short-term debts and liabilities due within the next lunar year.
Understanding Zakat
Zakat is one of the five pillars of Islam, an obligatory charity paid annually by Muslims who meet the necessary criteria of wealth. It serves as a means of purifying one's wealth and distributing it among the poor and needy, fostering economic justice and social welfare within the community.
Who is Obligated to Pay Zakat?
Zakat is obligatory upon every adult Muslim who possesses wealth exceeding a specific minimum threshold, known as Nisab, for a full lunar year (Hawl). The individual must be sane and the owner of the wealth.
What is Nisab?
Nisab is the minimum amount of wealth that a Muslim must possess before being obliged to pay Zakat. It is traditionally defined as the value of 87.48 grams of pure gold or 612.36 grams of pure silver. For practical purposes, the gold standard is often used as it represents a higher threshold, ensuring Zakat is paid by those with substantial wealth. The Nisab value fluctuates with the market price of gold and silver.
What is Hawl?
Hawl refers to the completion of one full lunar year during which the wealth has been in the possession of the individual and has remained above the Nisab threshold. Zakat becomes due once this period is completed.
Zakat-Eligible Assets
Zakat is typically calculated on various forms of wealth, including:
- Cash: Money held in bank accounts, savings, or in hand.
- Gold and Silver: This includes jewelry, coins, bars, or any other form of gold and silver not primarily for personal adornment (or exceeding a certain amount for personal use, depending on scholarly opinion).
- Investments: Stocks, shares, mutual funds, bonds, and other investment vehicles. Zakat is usually calculated on the current market value of these investments.
- Business Assets: Inventory, trade goods, and raw materials intended for sale. Fixed assets like machinery or property used for business operations are generally not Zakat-eligible themselves, but their net income may be.
- Rental Income: Net income derived from rental properties after deducting expenses.
- Debts Owed to You: Money lent to others that is expected to be recovered.
Deductible Liabilities
Before calculating Zakat, certain short-term debts and liabilities can be deducted from your total assets. These typically include:
- Short-term loans or debts that are due within the next lunar year.
- Outstanding bills or expenses that are immediately payable.
Long-term debts, such as mortgages, are generally not fully deductible, though some scholars allow for the deduction of the portion due within the next year.
How is Zakat Calculated?
Once your total Zakat-eligible assets and deductible liabilities are determined, the calculation is straightforward:
- Calculate Nisab: Based on the current market value of 87.48 grams of gold.
- Calculate Net Zakat-Eligible Wealth: Total Assets – Total Deductible Liabilities.
- Compare with Nisab: If your Net Zakat-Eligible Wealth is less than the Nisab, no Zakat is due.
- Calculate Zakat Due: If your Net Zakat-Eligible Wealth is equal to or greater than the Nisab, then Zakat due is 2.5% of this net wealth.
Paying Zakat is a spiritual obligation and a means of supporting those in need, contributing to a more equitable society.