Zakaah (Divine tax) is that portion of one’s wealth with certain stipulations which must be paid to a particular person or persons.
Zakaah is an act of worship (Ibaadah) and is not a governmental tax. An Islamic state can introduce systems to enforce that the zakaah is paid. Zakaah is compulsory and intention for paying zakaah is essential for its validity to differentiate it from optional charity (Sadaqah).
Allah Ta’ala has stated in the Qur’aan: “And establish regular prayer (Salaat) and pay Zakaah.” Chapter 2: Verse 43. Zakaah has been mentioned with Salaat in many verses of the Holy Qur’aan.
As reported by Imam Bukhaari and Imam Muslim, the Prophet Muhammad (S.A.) has said: “Islam has been built on five (pillars)- testifying that there is no god but Allah and that Muhammad is the messenger of Allah, performing the prayer (Salaat), paying the Zakaah, making the pilgrimage to the House (House of Allah in Mecca), and fasting in Ramadan.” Zakaah being one of the pillars of Islam denotes its importance in the lives of Muslims.
Zakaah, which literally means ‘purity’, cleanses one’s wealth and serves as a means of removing excessive love and greed for wealth. Allah commanded the Prophet Muhammad in the Qur’aan: “Take from their wealth alms so that you may purify and sanctify them……” Chapter 9: Verse 103.
Zakaah also literally means ‘increase’ and ‘sufficiency or barakah’. When one pays zakaah, he or she can hope for increase and barakah in the wealth. If any calamity befalls the wealth after paying zakaah, then it should be regarded as a test from Allah.
As reported by Imam Tirmizi, the Prophet Muhammad (S.A.) has said: “Wealth does not decrease due to alms.”
Zakaah teaches one to be charitable. Therefore along with paying zakaah, one should exercise optional charity to help the poor and to spend in the cause of Islam.
Those who do not pay Zakaah, are entitled to be punished by Allah in this world and in the Hereafter. Allah has stated in the Qur’aan: “And those who hoard gold and silver and do not spend them in the way of Allah, give tidings unto them of a painful punishment. On the Day when that (hoarded wealth) shall be heated in the Fires of Hell and their foreheads, sides and backs branded with it, (it will be said to them): ‘These are the treasures which you have hoarded for yourselves. Now taste of what you used to accumulate.’ ” Chapter 9: Verses 34-35.
Zakaah is applicable on wealth. Due to the vast changes in the forms of wealth, money etc. from the time of the Prophet Muhammad (S.A) many issues of Zakaah have become technical which must be discussed and solved by the learned of the Muslim community.
Zakaah, being a pillar of Islam and an Ibaadah, the following points must be taken into consideration.
Precaution must be applied in Ibaadah; the poor must be considered; devices to evade Zakaah must not be implemented; payers of Zakaah must not be oppressed.
The views of the four renowned Imams of Jurisprudence as well as others should be studied to attain a wide knowledge on Zakaah and to apply the rule of precaution.
Those on whom Zakaah becomes compulsory
Zakaah will become compulsory on a person who is a Muslim, who has reached the age of puberty (baaligh) and is sane, providing such a person owns for a year certain types of wealth equivalent or more to the minimum amount liable to Zakaah which is called the Nisaab.
The minimum wealth liable to Zakaah (Nisaab) is a certain amount of productive wealth that is free from debt and from one’s necessaries of life.
Productive wealth upon which Zakaah is levied
1. Gold and silver in whatever form they may be as coins, jewellery, cash, banknotes, utensils etc.
2. Articles of merchandise.
3. Certain livestock that graze freely for most of the year for the purpose of milk and procreation, as camels, cows, buffaloes, goats and sheep.
4. Land produce as wheat, dates, vegetables, fruits etc.
Note: According to Imam Abu Hanifa (R.A) there is no Nisaab for land produce and Zakaah will be levied on land produce of any amount even though the land may be owned by a minor or an insane person. When there is no Nisaab, then the passing of the year, being free from debts and necessities of life are not applicable.
5. Treasures and minerals: As wealth found and metals from mines like gold, silver, brass, iron etc.
Note: According to Imam Abu Hanifa there is no nisaab for treasures and minerals, and Zakaah will be levied upon them in any amount.
Zakaah will be levied upon productive wealth of the first three mentioned categories provided they are a certain amount liable to Zakaah. Not investing productive wealth will not remove their productive nature.
The necessities of life are: dwelling houses, household furniture, clothes, food, vehicle, animals for transport or ploughing, books, tools and such items that are for personal use. Therefore the value of such items of necessity and personal use will not be used for calculating the Nisaab and Zakaah will not be levied upon them.
Nisaab and rates
Gold: Twenty Dinaar= 2.8 Troy ounces = 87.5 grams. Rate = 2 ½ %
Silver: Two hundred Dirhams = 19.7 Troy ounces = 612.4 grams. Rate = 2 ½ %
Articles of merchandise: The nisaab of gold or silver. Rate = 2 ½ %
Sheep and goats: 40 heads Rate = Schedule
Cows and buffaloes: 30 heads Rate = Schedule
Camels: 5 heads Rate = Schedule
Land produce: No nisaab Rate = 10% or 5%
Treasures and minerals: No nisaab Rate = 20%
How to calculate Zakaah
Gold, silver and articles of merchandise
For wealth belonging to the first two categories, that is gold and silver, and articles of merchandise, Zakaah will be calculated on a yearly basis. One must possess the nisaab at the beginning of his Zakaah year and at the ending of his Zakaah year. The nisaab being affected during the year will not invalidate the year. Any wealth of these categories acquired during the year will be added to the nisaab and Zakaah will be levied upon it. Therefore the passing of a year on the acquired wealth during the Zakaah year is not a condition.
If one’s nisaab was affected to the extent that it was completely lost then such Zakaah year will cease and such a person will start another Zakaah year whenever he possesses a nisaab.
At the end of the Zakaah year one will total the value of gold and silver in all forms: cash, money lent out, bonds, shares, and articles of merchandise at the present cost price (wholesale). From such a total one will minus his debts. The remaining amount will be subject to 2 ½ % of Zakaah if it is equal or more to the nisaab.
For wealth belonging to the third category, that is livestock that graze freely for most of the year and are kept for milk and procreation, at the end of the Zakaah year one will count his animals and minus the value of his debts from the value of animals. The remaining heads of animals, having reached its particular nisaab, will be subject to Zakaah according to a rate as per the relevant schedule or table. The value of one type of animal will not be added to the value of another type of animal to calculate the Zakaah, since the heads of each type of animal are in themselves the factor to establish their nisaab, unlike gold or silver or articles of merchandise.
Note (i) If one owns gold, silver, money, articles of merchandise as well as livestock liable to Zakaah, such a person has a choice to minus his debts from the value of the livestock or from the gold, silver, money and articles of merchandise. It is preferable that such a choice be adopted that is more beneficial for the poor.
Note (ii) Livestock such as camels, cows, buffaloes, goats and sheep, if owned and allowed to graze freely for most of the year not for the purpose of milk and procreation, but for riding, transportation or meat then such livestock will not be subject to Zakaah.
Note (iii) Livestock other than camels, cows, buffaloes, goats and sheep are not subject to this category of Zakaah and there is no schedule for them, like rabbits, birds, chicken etc.
Note (iv) If any type of livestock or animal is kept and reared for trade, then such animals will fall under articles of merchandise and their value will be used to establish their nisaab and not their heads.
Note (v) Livestock acquired during the Zakaah year, whether by birth, purchase, or by gift, will be added to the nisaab of the particular type of animal and Zakaah will be levied upon them.
Note (vi) The value of gold, silver or articles of merchandise will not be added to the value of livestock that are not kept for trade to calculate the Zakaah, nor vice versa.
Land Produce (Crop)
For wealth belonging to the category of land produce or crop, one will pay as Zakaah 10% of whatever amount the land produced or its value if the land was watered naturally by rain water, river water etc. However one will pay 5% instead of 10% if the land was watered in the major period by manual effort; or otherwise incurring a cost as by pumps etc.
This 10% Zakaah is called Ushr or tithe.
Note (i) The cost of cultivation and reaping etc. will not be deducted before levying the 10% or the 5%.
Note (ii) No types of debts will be deducted before levying the 10% or the 5%.
Note (iii) The portion of crop that perished or becomes destroyed will not be subject to the Zakaah.
Note (iv) There is no fixed nisaab for crops, and there is no need for the passing of the year. All crops will be subject to the Zakaah.
Zakaah will be levied on that gold or silver found in personal jewellery based upon the general meaning of the following verse of the Holy Qur’aan: “And those who hoard gold and silver and do not spend them in the way of Allah, give tidings unto them of a painful punishment”. Chapter 9: Verse 34.
The mentioned verse stated gold and silver in the general sense which include coins (money) and jewellery, while there is no authentic Hadith which clearly exempts gold and silver found in jewellery for personal use from the verse of the Qur’aan.
This view is preferred as it is one of precaution, beneficial to the poor, and a prevention of hoarding gold and silver in the form of personal jewellery with stern warning in the verse of the Holy Qur’aan.
Nisaab of Silver and Gold
The nisaab of silver is two hundred Dirhams (silver coins) whose weight is 612 grams of silver or 19.7 Troy Ounce. The Dirhams used at the time of the Prophet (S.A) had a particular weight as well as a particular value.
The Prophet (S.A) specified the weight of the Dirham that is to be used as the nisaab. On the authority of Abu Saeed Al Khudri (R.A) as reported by Imam Bukhari, the Prophet (S.A) said: “There is no Sadaqah (Zakaah) on that which is less than five Awaaq (plural of Uqiyah)”. Since the weight of an Uqiyah is 40 Dirham that was used at the time of the Prophet (S.A), five Awaaq equals 200 Dirham (silver coins).
Various Hadith of the Prophet as well as the practice of various companions and Islamic Jurists indicate that 200 Dirham (silver coin) equaled the value of 20 Dinaar (gold coins). The weight of 20 Dinaar equals 87.5 grams or 2.8 Troy ounces.
To establish the nisaab for articles of merchandise or money (cash) either the value of the nisaab of gold or silver can be used if they are both equal.
If the value of the nisaab of gold and silver are not the same, then the lesser will be used as the nisaab. This is of precaution and is beneficial for the poor as by using the lesser value more Muslims will pay Zakaah.
The preferred view is to use the lesser value of the two nisaab in all places at all times.
While acknowledging and accepting both Nisaab as valid and sound, some of the early jurists and scholars adopted the gold Nisaab simply because of its minimal fluctuation. Many other jurists from the former and latter generations (of Muslims) however, accepted and adopted the silver Nisaab and considered it most appropriate for non-metal money (paper currency). They explained that this should be adopted since:
1) The silver Nisaab is determined explicitly by the authentic Sunnah (teachings of the Holy Prophet Muhammad [SA]) and the Ijma’ (Unanimous agreement of all the Sahabahs / companions of the Prophet) unlike the gold Nisaab which does not hold this position.
2) It is more beneficial to the poor and needy, which in reality, is the main objective of paying Zakaah.
3) It is more precautious in one’s religious duty.
4) The Nisaab of silver has been clearly specified by the Holy Prophet Muhammad (SA) and must not be altered due to the change in times. It is a divine injunction which is not subjected to analogy.
5) There is no proof in the Shariah which shows that one Nisaab must constantly be changed to facilitate the value of the other one. If this is the case then the original law of the Shariah would eventually be changed.
Those who can receive Zakaah
Zakaah is to be given to the poor (Faqeer) and the needy (Miskeen) from the wealth of those upon whom Zakaah is compulsory, that is those who are well-to-do. On the authority of Ibn Abbas, both Imam Bukhari and Imam Muslim narrated that the Prophet (S.A) told Mu’adh Ibn Jabal when he sent him to Yemen: “…tell them also that Allah has enjoined sadaqah (Zakaah) upon their assets which will be taken from their well-to-do people and distributed to their poor people….” Therefore the main purpose of Zakaah is to relieve poverty by helping the poor and the needy.
The following verse of the Qur’aan specifies the use of Zakaah for the poor and the needy as well as six other cognate purposes.
“Alms are only for the poor and the needy, and those who collect them, and those whose hearts have been (recently) reconciled (to the Truth), for those in bondage and in debt, and in the cause of Allah, and for the wayfarer: a duty imposed by Allah. Allah is the Knower and the Wise.” (Surah Taubah: Verse 60).
The eight categories to receive Zakaah
(1) Poor (Faqeer) and (2) Needy (Miskeen):
A poor person (Faqeer) is one who has little means; while a needy person (Miskeen) has no means.
These two categories are common in the sense that they do not have enough wealth to suffice their basic necessities of life, hence they do not have wealth beyond their basic needs. All the Imams have agreed that such two categories can accept Zakaah and that Zakaah will not be compulsory upon them in their condition.
According to Imam Abu Hanifa, a person who owns the value of the nisaab in his personal wealth, that are not of a productive nature as clothing, house, vehicle etc, and such wealth is beyond his basic necessities of life will not be obligated to pay Zakaah and will not be allowed to accept Zakaah.
Imam Muhammad, a student of Imam Abu Hanifa, is of the opinion that a person who owns the value of the nisaab that is subject to Zakaah but is not sufficient to meet the basic needs of himself and his family members for a year can accept Zakaah to fulfill the relevant needs.
Therefore one will pay the Zakaah that is due of his wealth and can accept Zakaah that may be needed to meet his basic necessities of life for himself and his family members such as food, clothing, housing, medicine, education, transportation, etc.
Imam Malik, Imam Shafi’i and Imam Ahmad are of the opinion that one who is in need of basic necessities of life for himself and family members can accept Zakaah to fulfill the needs even though he owns a nisaab that is subject to Zakaah; and one who is not in need of basic necessities of life for himself and family members will not accept Zakaah even though he may not own a nisaab that is subject to Zakaah. The distribution of Zakaah needs proper supervision so that the needs of the needy persons will be fulfilled and those accepting Zakaah must fear Allah and accept in valid situations of need.
The preferred view is that Zakaah can be given to one who is in need of the basic necessities of life for himself or his family members under his care and he hasn’t the means to fulfill those needs. However, to take into consideration the view of Imam Abu Hanifa out of precaution, one can borrow money for such basic necessities of life and then accept Zakaah to repay such debts.
The amount to be given to a poor or needy person is that amount that will suffice for one year according to the Maliki scholars and Hanbali scholars.
According to the other scholars, those who are able to earn a living by trade or skills can be given that amount to purchase relevant machines or tools that they can seek a livelihood for the rest of their lives without having the need to beg or to accept Zakaah.
Those who cannot earn a living because of incapacity or old-age as well as women and children, may be given Zakaah on a yearly basis or monthly basis.
According to Imam Abu Hanifa, more than the nisaab should not be given, that is 19.7 troy ounces of silver or its value.
The preferred view is that any amount can be given to fulfill the basic necessities of life for oneself and his or her family members.
According to the four renowned Imams of Fiqh, the Zakaah must be given to the poor and needy that they become the possessors of the Zakaah, which is called “Tamleek” i.e. making the recipient a possessor. The poor and needy must be Muslims since the Prophet (S.A) instructed Mu’adh Ibn Jabal to take the Zakaah from the well-to-do (Muslims) and give to the poor (Muslims).
Those who can earn a living to fulfill the basic necessities of life will not be given Zakaah.
Students who commit themselves to study, particularly religious knowledge, can be given Zakaah to meet their expenses, since there is benefit for the entire Muslim community. Educational institutions can be entrusted with Zakaah to be actually given to poor or needy students to pay their fees etc.
According to Imam Abu Hanifa, Zakaah cannot be spent on public utilities as building roads, schools, mosques, etc. nor to pay for salaries etc. Zakaah must be given to the poor and needy who become the possessors. The other three Imams, namely Imam Malik, Imam Shafi’i and Imam Ahmad agreed with Imam Abu Hanifa except they are of the view that Zakaah, along with helping the needy soldiers for Jihaad, can also be utilized for military needs as military hospitals, weapons etc. This will be further discussed under category number seven.
Persons, who commit themselves to optional acts of worship and are capable of earning a living, will not be given Zakaah since there is no benefit to the Muslim community and such acts of worship can be performed along with earning a living.
(3) Those who collect them:
Those Muslims who have been appointed by the Islamic authority to collect Zakaah can be paid for their service of collecting Zakaah even though they may be well-to-do.
(4) Those whose hearts have been (recently) reconciled (to Truth):
Zakaah can be given to those who recently accepted Islam and are in need in order to help them withstand the pressures that may arise from their non-Muslim relatives etc.
According to Imam Ahmad and one view of Imam Malik, Zakaah can be given to non-Muslims in order to win them over to Islam or to avoid their harms to the Muslims.
According to Imam Shafi’i, Zakaah can be given to needy Muslims who recently accepted Islam in order to help them, or to encourage them to invite their unbelieving associates to accept Islam or to prevent harming the Muslims. Imam Shafi’i is of the opinion that Zakaah can be given only to Muslims and the wealth given to non-Muslims at the time of the Prophet was not Zakaah but of other wealth of the public treasury as spoils of war etc. or of personal wealth.
According to Imam Abu Hanifa, like Imam Shafi’i, Zakaah can be given only to Muslims. Imam Abu Hanifa is of the view that the rule of giving Zakaah to those who recently accepted Islam has been abrogated and that they may be given on account of being needy like other Muslims, since Islam gained glory at the latter days of the Prophet (S.A) and that Umar refused to give lands to those who recently accepted Islam after the death of the Prophet (S.A), which was approved by the other companions. According to one report, Imam Malik agreed with the view of Imam Abu Hanifa.
The preferred view is that Zakaah can be given to those needy Muslims who recently accepted Islam because of their being needy; and that the rule has not been abrogated, but is left to the Islamic ruler to utilize Zakaah, using precaution, and to give it to those who accepted Islam recently to encourage others to accept Islam or to avoid harming Muslims.
(5) Those in bondage:
Zakaah can be given to help Muslim captives of war or Muslim slaves purchase their freedom from their masters.
(6) Those in debts:
Zakaah can be given to those who are under debts and are unable to pay off their debts.
According to Imam Abu Hanifa, to make the debtor (person in debt) the possessor of the Zakaah is essential, as in all cases. Therefore he must be given the Zakaah to pay his debt or one can pay his debts from Zakaah money with his permission. If one wants to absolve the loan given by himself to a needy person, mere absolving will not be sufficient but Zakaah must be given to the needy debtor and then he repays his loans or he may first repay the loan and then receive the amount as Zakaah. This view of Imam Abu Hanifa of possession by the debtor is of precaution and is accepted by the other Imams.
(7) Those in the path of Allah:
The four renowned Imams, namely Imam Abu Hanifa, Imam Malik, Imam Shafi’i and Imam Ahmad agreed that the term “Fi Sabeelillah” that is “In the path of Allah” in this verse means Jihaad or Holy War to defend Islam. They all agreed that Zakaah can be given to needy Muslim soldiers to equip themselves for the Jihaad. They all agreed that on the other hand that Zakaah cannot be used for every Islamic cause as building Islamic schools, mosques, propagation of Islam; nor building public utilities as roads, bridges; nor to pay for services as wages except for collecting of Zakaah.
Imam Malik, Imam Shafi’i and Imam Ahmad are of the view that along with the needy soldiers for Jihaad, Zakaah can also be given to well-to-do soldiers and can be spent for military utilities that are necessary for Jihaad as military hospitals, weapons, transportation, food, roads and bridges etc. needed by the military etc.
Imam Abu Hanifa is of the opinion that Zakaah cannot be spent on military utilities since there will be no possession. He agrees that a well-to-do person who volunteers to participate in Jihaad may be given Zakaah to meet his needs of equipping himself.
Other scholars, both of previous time and present time are of the opinion that “Fi Sabeelillah” means Jihaad i.e. Holy War, as well as other systems that are necessary to propagate and defend Islam as writing and printing of books, teaching, lecturing, preaching etc.
The preferred view for precaution is the view of the four Imams meaning Holy War (Jihaad) and particularly the view of Imam Abu Hanifa that Zakaah can be given to needy soldiers to equip themselves personally to take part in the Jihaad. Other forms of wealth of public treasury can be used for military utilities as well as propagating and defending Islam by ways other than Jihaad.
(8) The Wayfarer:
A traveller who has difficulties in his journey can be given Zakaah to meet his relevant basic needs even though he has wealth at home. It is preferred that one who has wealth at home may borrow while on journey and then repay.
Those to whom Zakaah cannot be given
(1) The well-to-do: Zakaah is meant for the poor and needy. Therefore those who are well-to-do must not be given Zakaah nor should they accept Zakaah. The minor children of a well-to-do person cannot be given Zakaah. Adult children, having reached the age of puberty and are needy can accept Zakaah even though their parent(s) may be well-to-do.
(2) Those who can earn a living: Those who are capable of earning a living and can find suitable jobs to fulfill their basic necessities of life will not be given Zakaah.
(3) Non-Muslims: Non-Muslims will not be given Zakaah.
Note: According to Imam Ahmad and one view of Imam Malik, non-Muslims may be given Zakaah to reconcile their hearts to Islam. This will be done by the Islamic authority.
(4) Parents, Children and Wives: One cannot give his or her Zakaah to his or her parents or his or her children.
According to Imam Abu Hanifa the same ruling will apply to grandparents and those in line of ascent as well as grandchildren and those in line of descent.
A man cannot give Zakaah to his needy wife or wives.
A woman can give her Zakaah to her needy husband according to Imam Malik, Imam Shafi’i and Imam Ahmad. However according to Imam Abu Hanifa a woman cannot give her Zakaah to her needy husband. Imam Abu Yusuf and Imam Muhammad disagreed with Imam Abu Hanifa and agreed with the other three Imams.
The jurists however agreed that those parents, children and wives who fall under the category of debtors or wayfarers can be given the Zakaah of their children, parents or husband respectively.
(5) The family of the Prophet Muhammad: The four renowned Imams of the Mazhabs have agreed that Zakaah cannot be given to the descendants of Banu Hashim which include the families of Ali, Aqeel, Ja’far, Abbaas and Harith.
They all four agreed that when the system of the distribution of the spoils of war does not exist, then the descendants of Hashim can be given Zakaah.
Some scholars are of the view that such rule was only relevant to the time of the Prophet Muhammad to prevent the blame of utilizing that which is due for the poor and needy, and such rule is not relevant after the death of the Prophet Muhammad.
Imam Shafi’i is of the view that the descendants of Muttalib, the brother of Hashim, carry the same ruling of the descendants of Hashim.
And Allah knows best.