What is Zakat?
Zakat is an annual payment made by eligible Muslims all over the world. This obligatory donation is made by the Nisab value for one year. Being one of the fundamental acts of worship defines the significance itself. It is a beloved act near Allah, as it serves humanity in several ways by helping out the unfortunate.
$100-Zakat
“And perform As-Salat (Iqamat-as-Salat), and give zakat and whatever of good (deeds that Allah loves) you send forth for yourselves before you, you shall find it with Allah. Certainly, Allah is All-Seer of what you do.”
Quran (2:110)
When can you give out Zakat?
Zakat has to be given out by a Muslim whose wealth marks a minimum threshold, according to the ‘value’ of Nisab. The calculation of the days starts from the day you pay your Zakat, any time of the year. Until the next time it completes one Islamic year.
Zakat can be paid at any time throughout the year. However, Ramadan holds a special essence for Muslims as it is believed that the rewards of these donations increase tri-fold in this holy month. Zakat should not be confused with zakat Al fitr or fitrana as they are compulsory to be paid in the holy month of Ramadan.
Whom to give Zakat?
This Islamic Donation should primarily be intended for the eligible recipients. According to the religion, these recipients can be placed in 8 categories.
- The poor
- The needy
- The Destitute
- For the reconciliation of hearts
- Those in debt
- In the path of Allah
- Travelers
- Slaves and Captives
The distribution of zakat should be carried out with justice and care. Ensuring that it reaches the intended recipients. Many Muslims donate their zakat to Reputable organizations involved in charity or local committees that are responsible for fair distribution.
Calculation of Zakat
By the Nisab Threshold, if the amount of your wealth increases, that Nisab Limit with one Lunar year, which is 354 days long. You qualify as an eligible donor of Zakat.
The two major Nisab values through which the threshold is determined are:
Gold – the monetary value of 87.48 grams of gold.
Silver – the monetary value of 612.36 grams of silver.
This standard amount varies according to the time and by geographical region. Hence the Nisab value changes as well. Tools like the Zakat calculator are great assisting tools. Otherwise, consulting with knowledgeable Islamic scholars and financial advisors can provide further guidance.
How much do I need to pay?
Other than the household items, the things which are in your genuine usage and any amount which is counted as debt. Zakat applies to all other assets which cross the Nisab value.
Other than the household items, the things which are in your genuine usage and any amount which is counted as debt. Zakat applies to all other assets which cross the Nisab value.
Primarily, it’s applied to the amount of silver and Gold in your possession
2.5 percent of the annual savings in the form of wealth.
Any amount of extra land that you own as an asset. Or a house (which you don’t live in and is a source of passive income)
Can Zakat be paid in Installments?
It is permissible to pay Zakat in installments, especially when your Zakat eligible amount is substantial, and it is more convenient to pay over time. However, it is preferred as a lump sum amount otherwise.
