Zakath Calculator

There are Five pillars of Islam and one of the fundamental pillar is Zakath. It is mandatory on all muslims who are of eligible wealth. Zakath is due from and payable by a person from his Wealth(not from his income),which has remaind with him/her for one islamic year. This a very useful application to calculate your zakath.

Details of Each Section to be used in conjunction with the Calculation Spreadsheet.

Zakath on Pure Gold and Gold Jewellery
Zakath should be calculated at 2.5% of the market value as on the date of valuation (In our case we consider 1st of Ramadhan). Most Ulama favour the Market Value prevailing as on the date of Calculation and not the purchase price.

Zakath on Precious and Semi-Precious Stones
There is considerable contention on whether these are to be considered for valuation. In my humble opinion if they have a value, then they calculate towards your wealth, and it is on the wealth that Zakath is mandatory. However please consult with Mufthi, before acting on this section. Most Ulama contend that a diamond is a piece of carbon and its value varies, unlike that of gold or silver.

Zakath on Silver.
Zakath is to be paid on Silver in Pure form or Jewellery, Utensils, Decorative items and all household items including crockery, cutlery made of silver at 2.5% of the prevailing market rates.

Zakath on Cash and Bank Balances
Zakath should be paid at 2.5% on all cash balance and bank balances in your savings, current or FD accounts. The amount technically should be in the bank for one year. Usually it happens that the balance keeps on changing as per personal requirements.
You may make your best judgement and the best way is to pay on remaining amount on the day of calculation.

Zakath on Loans Given, Funds, etc
Zakath is payable by you on loans you have given to your friends and relatives. It should be treated as Cash in Hand. You may deduct Loans Payable by you to arrive at the net present value of your wealth. However, if you are in doubt, on the return of your money, then you may not calculate it as your wealth. You can add it to your wealth, if and when your receive your money.
Zakath is payable on all Govt Bonds, Public Sector Bond, paid-up Insurance premiums, your paid-up portion of Provident Funds, Govt Bills receivables, etc. Pls remember you need to be aware of what the sharia says about Insurance and other types of investments. It is outside of the scope of this Zakath Calculator.

Zakath on Landed Property
Zakath is not payable on personal residential House even if you have more than one and meant for residential purpose only. Also Zakath is not applicable on the value of Property given on rent irrespective of how many. However Zakath is payable on the rental income itself after deducting the maintenance and other expenses.
However if your intention of holding properties is to sell at a future date for a profit or as an investment, then Zakath is payable on the Market Value of the property. Also, if your intention of holding properties changes in the current year, I.e. from self use to business then you need to pay Zakath on that Property Value.

Zakath on Business
This is for Business Persons only. No matter what business you are into, you've got to pay Zakath on all STOCK-IN-TRADE. The stock must be valued at its Landed Cost Price. If you have any bills receivable (sales given on credit) then you need to add the same towards calculations. Deduct the Amounts due to your suppliers and deduct the loans on stock on the date of calculation. Dead Stock should be calculated on scrap value or its saleable value. Damaged stock should also be valued at its scrap value.
Be honest in the calculations.There is no Zakath on Factory Buildings or any kind of machinery, but there is zakath on products produced in the factory (i.e. finished goods value). Please refer to a competent Mufti or a scholar who can shed more light on your specific issues.

Zakath on Partnership Firms
Zakath can be paid EITHER by the firm OR separately by the owners. If the firm is not paying, and the partner wants to calculate his share, he should take the amount standing to his capital and loan account as per the last balance sheet. Add his estimated share of profit till the date zakath is calculated.
This can only be estimated as it is difficult to calculate the exact profit or loss between an accounting year.

Zakath on Agricultural Product
Zakath is payable on all Agricultural produce including fruits, commercially grown flowers, vegetables and all types of grains at the harvest time itself. The passing of One year does not apply for agricultural produce. If there are two or more crops on the same land per year, then Zakath has to be paid as many times on the crop, irrespective of the time.
The Consensus formula for Zakath calculation on Agriculture is as follows:
On crops dependent purely on rain water it will be 10% of produce, On crops not irrigated through rain water but use Canal Water, Tank Water, Borewell and Open wells, the Zakath is 5% of the produce. For Crops dependent partly on Rain Water and partly on other water, the Zakath applicable would be 7.5% of produce.

Zakath on Animals
On all grazing animals like goats, sheep, camel, cows, broiler chickens, the consensus Zakath payable is one animal/bird for every 40 animals owned. However you may wish to give cash in lieu of the animal/bird itself.Please consult your Mufti who can guide you to the right direction.

Liabilities Deductions
If you have any pending tax payable to the govt, as of the date of Zakath Calculation, then the same may be deducted before arriving at the net worth. If you have taken any loans from any person or institution, and if you have not already deducted the same from any of the above sections, then you can deduct your Payables over here. Please be truthful, as Zakath is a sure way of protecting ones wealth if Zakath has been paid on it regularly and fully.

For More doubts in calculating Zakath kindly contact your competent Mufti who can shed more light on your specific doubts.

Run the file using Microsoft Office Excel to use

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