Zakat in Islam is an integral pillar because it holds great significance for Muslims worldwide. The meaning of zakat encompasses cleanliness and purification. It is an act of obligatory charity that serves as a means of purifying wealth and aiding those in need. This means that every financially able Muslim is required to donate a certain amount of wealth.
Giving Zakat holds numerous following benefits that extend beyond financial assistance. Here are important facts about zakat:
- Purifies and cleanses wealth
- Fulfils an important pillar of Islam
- Demonstrates obedience to Allah’s command
- Promotes social and economic equity
- Provides financial support to needy people
- Strengthens the bonds of brotherhood and community
- Cultivates empathy and compassion
- Creates a sense of gratitude and contentment
- Facilitates personal spiritual growth and humility
- Promotes self-discipline and moderation in wealth management
How Zakat in Islam Works?
No one’s religion is complete if he/she doesn’t pay Zakat. Our beloved Prophet Muhammad (Peace Be Upon Him) said in Sahih al-Bukhari 8, (regarding the five pillars of Islam)
- To testify that none has the right to be worshipped but Allah and Muhammad is Allah’s Messenger (ﷺ).
- To offer the (compulsory congregational) prayers dutifully and perfectly.
- To pay Zakat (i.e. obligatory charity).
- To perform Hajj. (i.e. Pilgrimage to Mecca)
- To observe fast during the month of Ramadan.
Zakat on Property
In Sahih al-Bukhari 1454 (Book 24, Hadith 57), Prophet (PBUH) enlisted the amount of zakat that should be paid on an individual property
Zakat on Camels and sheep
The specific requirements for Zakat payment vary based on the number of camels owned by an individual:
- For 24 camels or less, sheep should be paid as Zakat.
- The ratio is one sheep for every five camels.
- Different types of sheep (Bint Makhad, Bint Labun, Hiqqa, Jadha) are specified for varying ranges of camel numbers.
- Additional sheep are required for specific ranges of camel numbers beyond 24.
- If a person owns only four camels, they are not required to pay Zakat, but voluntary contributions are permitted.
Regarding Zakat for sheep, the number of sheep owned determines the Zakat payment:
- Specific ratios of sheep to be paid based on ranges of sheep numbers.
- Additional sheep are required for specific ranges of sheep numbers beyond 40.
Zakat on Silver, Gold and Wealth
The amount of gold and silver is determined by a specific threshold known as the Nisab.
For gold, the Nisab is equivalent to 7.5 tolas ( 3 ounces / 87.48 grams) of pure gold. If your gold holdings, after deducting personal items like jewellery and ornaments that are regularly worn, reach or exceed this weight, Zakat becomes obligatory on the excess amount.
For silver, the Nisab is set at 612.36 grams of pure silver. If the value of your silver assets, excluding items like cutlery, utensils, and other personal belongings, reaches or exceeds this weight, you would be required to pay Zakat on the surplus.
- For silver, the Zakat payment is one-fortieth of the total value (2.5%).
- For gold, the same formula applies, Zakat payment is one-fortieth of the total value (2.5%)
- If the value of silver is less than two hundred Dirhams, Zakat is not required, but voluntary contributions are permitted.
Zakat on Cash
Zakat must be paid on capital money and profit. It is obligatory for Muslims to pay 2.5% on all cash balances and also bank balances in their savings. However, if your money is deposited in a bank that deals with cash and interest, then zakat is to be paid on capital money only. There is no zakat on interest because it is haram (forbidden) in Islam.
Zakat on Land
According to Islamic jurisprudence, Zakat is generally not required on land that is solely owned for personal use or personal residence. However, if the land is intended for sale or investment purposes, Zakat may be applicable on its value.
Zakat on Agriculture Land
Our Messenger (PBUH) said ‘’On a land irrigated by rain water or by natural water channels or if the land is wet due to a near by water channel Ushr (i.e. one-tenth) is compulsory (as Zakat); and on the land irrigated by the well, half of an Ushr (i.e. one-twentieth) is compulsory (as Zakat on the yield of the land).’’
[Sahih al-Bukhari 1483]
The amount of Zakat on agricultural land produce depends on the method of cultivation and the type of crops it produces. It is typically calculated as a portion or percentage of the yield, ranging from 5% to 10% or even higher in certain cases.
- For Barren land, it is 10%, (as the land is irrigated by rains and streams)
- For irrigated land, it is 5% (as the land is irrigated with water from wells)
Sadaqah and Zakat
There is a difference between Zakat and Sadaqah. Zakat is an obligatory form of charity that is required to be paid by eligible Muslims who meet the Nisab threshold, while Sadaqah is a voluntary act of giving that can be done at any time and in any amount.
Where to Give Zakat?
Zakat should be donated to eligible recipients who fall under one or more of the eight categories mentioned in the Quran (Surah At-Tawbah, 9:60). These categories include:
- The poor and needy
- The destitute
- Those who are employed to collect and distribute Zakat
- Those whose hearts are to be reconciled (new Muslims or those inclined towards Islam)
- The freeing of slaves
- Those in debt
- In the cause of Allah (for the general welfare and public interest)
- Travellers in need
When to Pay Zakat?
Once the day arrives when your total personal wealth and holdings meet or exceed the Nisab threshold, it becomes obligatory to pay zakat within a year.
How to Pay Zakat?
- Calculate your Zakat: Determine the value of your eligible assets, including cash, savings, Gold, silver and etc.
- Determine the Zakat rate: Apply the Zakat rate of 2.5% to the total value of your eligible assets.
- Find eligible recipients
Zakat is an essential aspect of the Islamic faith and a powerful means of promoting economic justice, compassion, and social welfare. By fulfilling the obligation of Zakat, Muslims not only fulfil a religious duty but also contribute to the betterment of society and their own spiritual growth.
If you want to get access to more insightful articles like this to increase your knowledge, subscribe online eQuranekareem Online Quran Academy newsletter.
Can you give Zakat to the family?
Zakat can’t be given to immediate family members including your spouse, children, parents and grandparents. However, zakat can be given to distant family members.
Is there any Zakat Calculator 2023 online?
Yes, there is an authentic website called baitulmaal, that offers an online zakat calculator.
I was eligible for zakat but I didn’t pay for many years. What should I do?
You have to pay zakat for previous years. Give 2.5% of your total wealth (for each year).
What does Islam say about giving Zakat on Loan?
Zakat is not required to be paid on a loan that you have given to someone else. The reason is that the loaned amount is considered a debt owed to you and not part of your Zakat-eligible wealth.