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You can use our Zakat Calculator to calculate how much you need to give.

Zakat calculator

Below are some Frequently Asked Questions that you can use for further guidance:

Who needs to pay Zakat?

Zakat is 2.5% of your total wealth. If you have £1,000 of wealth you are then liable to pay Zakat of £25.

What is the nisab & hawl?

The moment you possess wealth above the nisab threshold you become eligible to pay Zakat. However, no payment is due on that date itself.

In explanations of Zakat, you may hear the term hawl – which means a lunar year. A hawl (lunar year) is 354 days long. Sometimes it is simply referred to as an Islamic year.

The actual payment of Zakat is to be made one hawl (lunar year) after you become eligible to pay Zakat if your wealth on that date is still at – or above – the nisab threshold.

It does not matter if your wealth decreases or increases during the year. It is the value of your wealth/assets at the end of the lunar year that is used to calculate and pay the Zakat (if it still exceeds the nisab).

When do I pay Zakat?

Zakat is due on a yearly basis when a morally responsible Muslim possesses the minimal zakatable-amount (nisab) above and beyond his debts and immediate expenses, and a complete lunar year passes over it. In calculating one’s Zakat one calculates all his zakatable assets together.In calculating one’s Zakat one calculates all his zakatable assets together. “Zakatable assets” include:

(a) Cash – whether in currency form or in the bank,

(b) Gold and Silver,

(c) Money lent out,

(d) Trade goods,

(e) Stocks, and

(f) Agricultural produce.

After one calculates the above, one deducts:

(a) Debts, and

(b) Immediate expenses.

What do I count in my Wealth/Net Assets for Zakat?

Your wealth or net assets can be summed up as the liquid assets you possess minus your short term liabilities.

Liquid assets are those that can be transformed into cash very easily. Short term liabilities include your bills, rent, personal loans and credit card debts. Most scholars agree that any mortgage that you may hold, should not be included in that calculation.

Here’s a list of things that should be included in your assets:

  • Cash in the bank and at home
  • Cash saved for any special purposes e.g. wedding, Hajj, car purchase, etc.
  • The value of gold and silver you own
  • The value of shares at their market price
  • Money owed to you, which is highly likely to be repaid
  • If you own a business, the balance sheet value of the stock(s) you possess.
  • If you own properties, any rental income that has been saved

You do not need to count the value of your home or land as part of your assets.  You also don’t need to include person items, such as a car, clothing, home appliances, etc. as part of your assets.

If you own investment properties (to buy / to let), then any saved rental income will be a part of your assets. The equity value of your investment property portfolio is not included as part of your assets in the Zakat calculation.

If an investment property is due to be sold around your Zakat due date, then the anticipated profit is to be included as part of your assets.

Here is a list of things that should be included in your liabilities:

  • The money you owe to others i.e. personal loans (from banks and friends), credit card debts, etc.
  • Current month’s rent/mortgage payment or arrears
  • Bills that are due
  • If you own a business, then business expenses e.g. rent, rates, salaries, utility bills, etc.
  • Short term business loans and overdraft amounts are included in your liabilities.

The calculation for your wealth/net assets is:

  • Assets – short term liability = your wealth.

As long as your wealth is above the nisab of the day, you are eligible to pay Zakat.

Gold and Silver

According to the Hanafi madhab, all gold and silver you own must be included as part of your wealth/assets in the Zakat calculation.

In the Shafi madhab, however, any gold and silver that is for personal use do not need to be included as part of your wealth/assets.

If all of your wealth is in gold, the value of the gold you own must be at – or above – the gold nisab in order to be eligible to pay Zakat.

If your wealth is a mixture of gold and/or silver and cash, it is preferable to use the silver nisab threshold.

Many scholars hold the view that it will be highly beneficial to include all gold and silver that you own as part of your wealth/assets, regardless of whether they are for personal use or not.

Abu Huraira (RA) reported that Prophet Muhammad (SAW) said:

“Charity does not in any way decrease wealth and the servant who forgives, Allah adds to his respect; and the one who shows humility, Allah elevates him in the estimation (of the people).” (Muslim)

Shares & Property Trading

If you possess shares for the purposes of trading, then you must include their value in your wealth/assets.

However, if the shares you possess are not for trading, but rather held as an investment to deliver dividends, then it is only the dividends that need to be counted in your assets.

The same rule applies to property trading. If a property is purchased with an intention to resell it, then its value must be counted in your assets.

However, if a property is bought as an investment (for example to be let out) with the only benefit being the rental income, it is only the profit from the investment that is eligible to be counted under your assets.

Mortgages & Loans

A long-term mortgage is not to be counted as a liability in your Zakat calculation.

Loans that are taken out for personal purposes can be subtracted as a liability in the Zakat calculation

Business Goods & Property

The business stock has to be counted as an asset for Zakat purposes. The value to be used is what would appear on your balance sheet. Usually, it is the cost of purchasing the stock.

Business premises do not need to be counted as an asset in the calculation. Any property the business owns (land, retail units, etc.) also do not need to be counted as assets.

Who are the beneficiaries of Zakat?

The Holy Qur’an (9:60) specifies eight categories for the distribution of Zakat:

  • The poor
  • The needy
  • Zakat administrators
  • Those whose hearts are to be reconciled
  • Those in slavery
  • The debt-ridden
  • In the way of Allah
  • The destitute traveller

SKT Welfare distributes your Zakat amongst the needy and poor.

Zakat-ul-Fitr (Fitrana)

This is not to be confused with the annual Zakat payment.

Before the end of the month of Ramadan, every adult Muslim who has food in excess of her/his needs must pay what is known as Zakat al-Fitr or fitrana. They must pay for themselves and can also pay on behalf of his or her dependents.

Zakat al-Fitr / fitrana must be paid before the Eid prayer is performed. It is to be paid in the form of what is considered a staple food of the community.

As SKT Welfare acts as an agent for you, we can be given the money to pay for the food beforehand which we will then spend where needed at the correct time to buy and distribute the food amongst those in need.

Prophet Muhammad (SAW) determined the amount of food be donated as being at least one sa’a weight of food. One sa’a is equivalent to four madd – and a madd is the amount that can be scooped up when one puts their hands together.

If we translate this into a cash value based upon the price of staple food such as flour or rice, it is approximately £5 in today’s money.

Therefore, in the UK, the Zakat al-Fitr / fitrana is currently £5 per person.

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