Who owes zakat
Zakat is one of the five pillars of Islam, and the Quran pairs it with prayer again and again: “establish prayer and give zakah” (2:43). It also warns those who hoard gold and silver and do not spend it in the way of Allah (9:34). It is owed by a Muslim who owns wealth at or above the nisab, owned outright, for one full lunar year.
The schools differ on children and on people who lack mental capacity. The Hanafi school holds that zakat is owed only by an adult of sound mind. The Maliki, Shafiʿi and Hanbali schools hold that it is owed on the wealth itself, so a guardian pays it from a child’s savings. If you manage money for a child, ask which view your local scholars follow.
The nisab: gold or silver
The nisab is the minimum amount of wealth on which zakat is due. It was fixed in two metals: twenty mithqal of gold, usually converted to 85 grams, and two hundred dirhams of silver, usually converted to 595 grams. Some institutions use slightly different conversions, such as 87.48 g and 612.36 g; the gap is small next to the choice of metal.
When these measures were set, the two were close in value. Today they are far apart, because silver has become much cheaper relative to gold, so the silver nisab is a small fraction of the gold one. A person with modest savings can be above the silver threshold and well below the gold one.
To find the nisab in your currency, multiply the price of one gram by the weight: gold price per gram × 85, or silver price per gram × 595. Use the price on your zakat date, not one you remember. That is what this calculator does with the prices you enter; it prints no figure of its own because any figure would be out of date by the time you read it.
The lunar year (hawl)
Zakat falls due once a full lunar year, the hawl, has passed on wealth at or above the nisab. A lunar year is about 354 days, some eleven days shorter than the calendar year, so a date kept by the Gregorian calendar slowly drifts late. If you keep your zakat year by the solar calendar, many zakat bodies suggest a rate of about 2.577% instead of 2.5% to make up the difference.
The schools differ on what happens during the year. The Hanafi school looks at its start and its end: if you held the nisab on both days, dips in between do not matter, and money that arrives during the year is added to the total. The other three schools require the wealth not to fall below the nisab during the year. In practice most people choose one fixed zakat date and count everything they hold on that day.
What counts, and what does not
Zakat is due on wealth held as money or held to grow: cash, bank balances, gold and silver, shares and investment funds, goods bought in order to be sold, and money others owe you that you expect to get back. Land or property bought to resell is trade goods and is counted at its market value.
It is not due on things you own in order to use them: the home you live in, your car, furniture and clothes, and the tools, equipment and premises of your trade. A property you rent out is not counted on its value, but the rent you have saved is, if it is still in your account on your zakat date.
Jewellery is the most common point of difference. The Hanafi school counts gold and silver jewellery even when it is worn. The Maliki, Shafiʿi and Hanbali schools exempt jewellery kept for ordinary personal use, and count it when it is held as savings or goes beyond what is customary. Pensions you cannot yet draw and long-term shareholdings are also treated differently by different bodies.
Debts
The Hanafi and Hanbali schools deduct debts you owe from your zakatable wealth. The Shafiʿi school, in its main position, does not. The Maliki school deducts them from money but not from other kinds of wealth. Many contemporary zakat institutions deduct only what is due now, such as unpaid bills and the instalments falling due in the coming year, rather than the whole balance of a long loan. Deducting an entire mortgage would leave almost every homeowner owing nothing, however much cash they hold.
Money owed to you by someone who acknowledges the debt and can repay it is counted every year by most scholars. A debt you doubt you will recover is usually not counted until you receive it, and the schools differ on whether you then pay for the years it was outstanding.
Business inventory
A trader pays zakat on the stock held for sale, valued at its current market price on the zakat date, together with the business’s cash and the money customers owe it, less the debts it owes that are due. Fixed assets are not counted: the shop, machinery, vehicles, shelving and computers are tools of the trade, not goods for sale.
How the 2.5% applies
The rate is one fortieth, 2.5%, of the whole zakatable amount, not only of the part above the nisab. The nisab is a threshold: below it nothing is due, and once you reach it everything is counted. Crops, livestock and minerals follow their own rules and rates and are not covered by this calculator.
A worked example
These prices are for illustration only, not current prices. Suppose gold costs 100 per gram and silver 1 per gram, in any currency. The gold nisab is then 85 × 100 = 8,500 and the silver nisab 595 × 1 = 595.
On your zakat date you hold 3,000 in cash, 12,000 in the bank, gold coins worth 1,000, business stock worth 4,000 at sale value, and a 1,000 loan to a friend you expect to be repaid. That totals 21,000. Bills and instalments due now come to 2,000, leaving 19,000 of zakatable wealth. It is above both thresholds, so the zakat is 19,000 × 2.5% = 475.
Had the net figure been 5,000, it would sit above the silver nisab and below the gold one: 125 would be due on the silver basis and nothing on the gold basis. That is exactly the situation in which the choice of nisab matters.
When and to whom it is paid
Zakat is due as soon as the year is complete and should not be put off without good reason. The Hanafi, Shafiʿi and Hanbali schools allow paying before it is due, for instance in instalments through the year; the Maliki school permits only a short advance. Many people pay in Ramadan, which is simply a matter of fixing their zakat date there. Zakat al-Fitr, given before the Eid prayer at the end of Ramadan, is a separate obligation.
The Quran names eight categories of recipient (9:60): the poor, the needy, those employed to collect and distribute it, those whose hearts are to be brought together, freeing those in bondage, those in debt, the cause of Allah, and the stranded traveller. You cannot give your zakat to your own parents, grandparents, children or grandchildren, nor can a husband give it to his wife: they are people you are already bound to support.
Common mistakes
Counting only the savings account and forgetting cash at home, gold, or money others owe you. Paying 2.5% on the amount above the nisab instead of on the whole. Deducting an entire mortgage. Using a gold or silver price from months ago. Counting the family home or car. And treating charity already given during the year as zakat: zakat needs the intention of zakat when it is paid, so decide what a payment is before you make it.