How to Calculate Zakat: A Simple Guide
Zakat is one of the five pillars of Islam: an annual obligation to give a portion of one's wealth to those in need. It purifies wealth and supports the community. For most forms of wealth, the rate is 2.5% of the net zakatable amount, paid once a lunar year on wealth that has met the minimum threshold, called nisab.
Step 1: List your zakatable assets
- Cash at home and in bank accounts
- Gold and silver, valued at today's market price
- Investments and shares held for growth or trading
- Business stock and goods held for sale
- Money owed to you that you expect to be repaid
Personal items such as your home, car, furniture and clothing used for daily life are generally not included.
Step 2: Subtract debts due now
Deduct debts and bills that are currently payable, such as outstanding bills or instalments due. Scholars differ on how to treat long-term debts like a full mortgage balance, so many people deduct only the amount due in the current year.
Step 3: Check nisab
Nisab is commonly given as the value of 87.48 grams of gold or 612.36 grams of silver. Because silver is cheaper, the silver nisab is lower, so more people qualify to pay; many scholars recommend it as it benefits more recipients. Enter today's price per gram for your chosen metal, and the calculator compares your net wealth against it.
Step 4: Calculate 2.5%
If your net zakatable wealth is at or above nisab and you have held it for a full lunar year (hawl), zakat due is 2.5% of that amount.