I would like to know what is the percentage I should pay for sadaqa for that

Answered according to Hanafi Fiqh by

I have received a payout from pension as I have resigned. I would like to know what is the percentage I should pay for sadaqa for that.


In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh

Pension funds are of two types: voluntary and compulsory. If the pension fund was compulsory and you had no choice, then the funds issued by the pension fund will be considered as a gift from the government/employer. You will not have to pay Zakaat on compulsory pension funds for the previous years you were invested with the fund. You will only calculate your Zakaat on the funds received for the current year based on your personal financial situation. However if the pension fund was voluntary, then it will not be permissible to participate in the fund since the majority of funds are invested in impermissible conventional financial institutions. One should dispose of the dividends accrued of such pension funds and pay Zakaat on the capital amount beginning from the year one started investing in the pension fund. Therefore one will pay Zakaat on the previous years on the capital amount invested if the pension fund was voluntary.

And Allah Ta’āla Knows Best

Ismail Desai,

Darul Iftaa

Checked and Approved,

Mufti Ebrahim Desai.

This answer was collected from, which is operated under the supervision of Mufti Ebrahim Desai from South Africa.

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