Zakat

Zakat is the fourth pillar of Islam and refers to the obligatory donation to charity expected of every qualified adult Muslim meeting the level of Nisab. It’s how we give back money from our own wealth to those less fortunate. The word “zakat” comes from the Arabic which translate to “that which purifies”, Allah swt says in the Qur’an: “Take from their wealth to purify and sanctify them” (9:103). By recognizing that one’s wealth is a gift from Allah (SWT) and giving away a portion of it to others, a Muslim purifies the rest of his wealth from greed and avarice. In a world of gross social and economic inequality, it is vital for Muslims to observe the tradition of zakat.

Zakat is a right that the poor have over the rich; it is the duty of every wealthy Muslim to fulfill this duty towards those who are less fortunate. Zakat cannot be paid to everyone. Below are eight specific categories of people to whom Zakat can be given, an obligation imposed by Allah. And Allah is All-Knowing, All-Wise.” [Al-Qur’an 9:60]”

1. Al-Fuqara (The Poor)
2. Al-Masakin (The needy)
3. Zakat collectors
4. Who converted to Islam
5. Release of captives
6. Debtors
7. In the way of Allah
8. Wayfarer (the traveler who is cut off from everything)

Zakat is an obligatory duty on all able-bodied Muslims who own assets at or above a certain threshold. This threshold is called Nisab. You pay Zakat only if your net assets equal or exceed the Nisab threshold. Zakat should be calculated on the basis of 2.5% of all net savings that one owns that is above the nisab value. Net savings is the total wealth maintained for one lunar year before Zakat is due. If the net annual savings falls below this amount, he is exempt from paying zakat. Only those people whose net worth exceeds the nisab values ​​are required to give zakat.

The amount of nisab is calculated based on the current value of 3 ounces of pure gold. If you have only gold as an asset, you must use the Nisab rate for gold. However, if you have a combination of assets, then the Nisab level for silver should be used. There is a difference of opinion among some scholars who say that gold should be used regardless, however the use of silver is safer and more beneficial for the recipients of zakat. If your net assets (income and savings) are above the Nisab silver limit, you must pay Zakat on the total amount of wealth you own.