About Zakat

Zakat is one of the five pillars of Islam and an act of worship. The meaning of zakat is “to purify” and so to purify our own wealth all Muslims are obliged to pay a portion of one’s assets to help those in need. Zakat benefits the giver as well as the receiver. Zakat can also be spelled as zakah or zakat.

The Holy Qur’an tells us who may receive Zakat payments:

• The poor
• The destitute
• Administrators/collectors of Zakat
• New Muslims facing hardship
• To free slaves
• Those who are unable to pay their debt
• In the path of Allah (swt)
• Travellers who cannot afford to return home

All Muslim adults who are sane and possess the nisab (a minimum amount of wealth held for a year) should pay Zakat.

Nisab can be determined in terms of gold or silver – please see the Zakat calculator for details.

Although there are no specific guidelines in the Holy Qur’an on exact percentages to be given as Zakat, the customary practice is to give 2.5% on capital assets. On agricultural goods, precious metals and livestock, the rate varies between 2.5% and 20%.

You don’t have to do lots of complicated maths to work out your Zakat payment – simply use our handy online calculator.

Assets that are included in the Zakat calculation are cash, shares, pensions, gold and silver, business goods, crops and cattle and income from investment property.

Personal items such as home, furniture, cars, food and clothing (unless used for business purposes) are not included.

Zakat is payable as soon as the nisab (minimum amount of wealth) has been held for a lunar year. If the date of first becoming sahib-un-nisab (owner of wealth equal to or in excess of nisab) is known then use that as your Zakat date, if not a date may be chosen. Use the same date every year thereafter.

Wealth can fluctuate during the year, going above and below nisab. Zakat is only due if wealth is in excess of nisab at the end of a person’s Zakat year.

Yes, zakat can be paid monthly by setting up a regular monthly payment such as a direct debit. Penny Appeal can help you to do this with our zakat-eligible sponsorship programmes, suitable for a range of zakat levels.

These sponsorships can change lives and help build futures. Find out more about zakat-eligible sponsorships.

If Zakat has not been paid in previous years, whether through negligence or ignorance or error, then an honest attempt must be made to calculate the payment owed. This must then be paid as a matter of urgency.

Yes! All donations of $2 or more to Penny Appeal Australia are tax deductible.

Zakat can be spread throughout the year, for example by setting up a monthly direct debit. However, the total amount payable must be paid by the due date.

Zakat becomes payable as soon as the nisab (minimum amount of wealth) has been held for one lunar year. Some people choose to pay their zakat during Ramadan in recognition of this special time of year and because rewards for good deeds carried out during Ramadan are multiplied. However, it is our duty to pay zakat when it becomes due rather than delay payment and wait for Ramadan.

Tola is a unit of weight used in the Asian Subcontinent that is equal to the weight of a silver rupee. It is also known as bhori or vori. One tola is equal to 11.66 grams. Therefore, 87.48 grams of gold is equivalent to 7.5 tola.

The Holy Qur’an tells us who may benefit from zakat:

• THE POOR
• THE DESTITUTE
• ADMINISTRATORS OF ZAKAT
• NEW MUSLIMS FACING HARDSHIP
• MUSLIMS WHO ARE UNABLE TO PAY THEIR DEBT
• TRAVELLERS WHO DO NOT HAVE ENOUGH MONEY TO RETURN HOME
• PEOPLE WORKING IN THE PATH OF ALLAH
• ZAKAT MAY ALSO BE USED TO FREE SLAVES

The nisab is a minimum amount of wealth that a Muslim must possess for a whole year before zakat becomes due.