Paying Zakaat while having a mortgage or debt
Q. I have been reading up a lot online about the payments of Zakaat and I read somewhere that if one has a loan he may be exempted from paying this once the debt exceeds the savings. I was wondering however if this applies to a mortgage and if so is it to be calculated on the entire amount of the mortgage (the total for the 25 years) or the total for just one year?
A. Zakaah is levied on one’s savings. If part of your savings is used to pay a mortgage or a debt, then it will be permissible for you to subtract the amount which is due (at the time of paying the Zakaah) for the mortgage or debt and pay Zakaah on the remaining amount if it has reached a Nisaab. What is not due from you at the time of paying Zakaah must not be subtracted from the total savings.
Normally, a person pays a mortgage or a loan on a monthly basis. He may either pay this from his monthly Salary or from a savings which he has. If he is paying the loan/mortgage from his monthly salary, and is not using from his savings, then he must not subtract anything from his savings. If however, he uses from his savings to pay the monthly loan/mortgage, then only that amount which is due from him for that month (in which he is paying Zakaah) will be deducted from his savings. The total amount to be paid for that year will not be deducted since he is not required to pay that amount (when he is paying Zakaah). The entire amount of the mortgage for the period of 25 years will also not be deducted since the payment of this amount is not required of him at that time.
And Allah knows best.
Mufti Waseem Khan