Zakaat is one of the five pillars of Islam. It has been mentioned, along with daily Prayers (Salaat), over seventy times in the Qur’an. Allah’s word commanding “……..and establish regular Salaat and give regular Zakaat…….” are referred to in many parts of the Qur’an. From this we can conclude that after Salaat, Zakaat is the most important act in Islam.
Just as Salaat is the most important act of worship which has to be performed bodily, so is Zakaat the main act of worship which has to be performed monetarily. Those who fulfill this duty have been promised abundant reward in this world and hereafter. Whoever evades Zakaat has been sternly warned in the Qur’an and Hadith of the consequences.
Linguistically, Zakaat has two meanings: purification and growth. Technically, it means to purify one’s possession of wealth by distributing a prescribed amount to the poor, the indigent, the slaves or captives, and the wayfarer.
There are many major benefits of giving Zakaat:
· It reminds Muslims of the fact that whatever wealth they may possess is due to the blessings of Allah and as such it is to be spent according to the His commands.
· Zakaat functions as a social security for all. Those who have enough money today pay for what they have. If they need money tomorrow they will get what is necessary to help them live decently.
· Zakaat payer pays his dues to Allah as an act of worship, a token of submission and an acknowledgment of gratitude. The receiver of Zakaat receives it as a grant from Allah out of His bounty, a favor for which he is thankful to Allah.
· Economically, Zakaat is the best check against hoarding. Those who do not invest their wealth but prefer to save or hoard it would see their wealth dwindling year after year at the rate of the payable Zakaat. This helps increase production and stimulates supply because it is a redistribution of income that enhances the demand by putting more real purchasing power in the hands of poor.
Zakaat is obligatory upon a person if :
· He or she is an adult, sane, free and Muslim.
· He/she must possess wealth in excess of specified minimum (Nisaab) excluding his or her personal needs (clothing, household furniture, utensils, cars etc. are termed article of personal needs).
· It should be possessed for a complete lunar year.
· It should be of productive nature from which one can derive profit or benefit such as merchandise for business, gold, silver, livestock etc.
The amount of wealth which makes one liable for Zakaat is called Nisaab. The Nisaab as fixed by Rasulullah (sallallahu alaihi wassallam) is as follows:
Nisaab of cash, stock or bonds, other cash assets is the equivalent amount of Gold or Silver. Nisaab is calculated by adding up the cash value of all the assets such as gold, silver, currency etc. and if it is equal to or in excess of the minimum Nisaab as specified in the above table, the Zakaat is due at the rate of 2.5% .
The payment of Zakaat is compulsory on the excess wealth or effects which is equal to or exceeds the value of Nisaab, and which is possessed for a full Islamic year. If such wealth decreases during the course of the year and increases again to the value of Nisaab before the end of the year, the Zakaat then must be calculated on the full amount that is possessed at the end of the year.
TYPES OF WEALTH ON WHICH ZAKAAT IS IMPOSED:
1. Gold and silver, in any form
2. Cash, bank notes, stocks, bonds etc.
3. Merchandise for business, equal to the value of Nisaab
5. On income derived from rental business
CALCULATION OF ZAKAAT:
1. To calculate Zakaat on jewelry etc. one must first determine the gold or silver content and then calculate the Zakaat according to current market price.
2. If the Gold possessed is less than 87.48 grams or if silver possessed is less then 612.36 grams, but the value of both combined is equal to or exceeds the Nisaab of either Gold or Silver, the Zakaat will be due.
3. In the event of an article not being of pure gold or pure silver, but containing a mixture of other metals and the gold or silver content is more than the other metal, it will be regarded as gold or silver and Zakaat will be due. But in the case where other metal/s is of greater quantity than either gold or silver, Zakaat will not be due on this article.
4. For stocks (shares held in a company), Zakaat is calculated based upon the current market value. As machinery, land, fixtures and fittings, furniture, buildings etc. are exempt from Zakaat, one is allowed to subtract these from the total asset. This could be obtained from annual reports. For example, if one has shares worth $1000 and machinery, land etc., are worth 5% of the total asset, then deduct $50 for these assets, afterwards deduct the liabilities of the company proportionately to the percentage of shares held. Zakaat must be calculated on the balance.
DISTRIBUTION OF ZAKAAT:
1. Zakaat should be given as soon as possible after it becomes due.
2. All of the Zakaat can be given to one person or to several persons.
3. A poor man cannot be paid for his work from Zakaat nor can Zakaat be given in payment of services, except to the people appointed by the Islamic government to collect Zakaat.
4. Zakaat will only be valid if the recipient is made the owner of that amount. If, for example, a few needy persons are fed a meal from Zakaat money, then Zakaat will not be fulfilled as they were not made owners of the food.
5. Zakaat cannot be given for the construction of Masjid, Madrasah, Hospital, a well, a bridge or any other public amenity.
6. Zakaat can be paid in kind from the same merchandise on which it is due, or alternatively, it could be paid in cash .
TYPES OF WEALTH ON WHICH ZAKAAT IS NOT IMPOSED:
1. On any metals other than gold or silver
2. Fixtures and fittings of a shop, car, trucks or any delivery vehicle etc., which is used in running business.
3. Diamonds, pearls, other precious or semi precious stones which are for personal use.
4. There is no Zakaat on personal residence, household furniture, pots and pan, personal clothing, whether they are in use or not.
5. There is no Zakaat on a person whose liabilities exceed or equal his assets. (Home Mortgage in this country is not to be counted as personal liability for the Zakaat purpose).
RECIPIENTS OF ZAKAAT:
The recipients of Zakaat, according to Qur’an are as follows:
“Alms are for the poor and the needy, and those employed to administer (the funds); for those whose hearts have been (recently) reconciled (to truth); for those in bondage and in debt; and for the wayfarer: (Thus is it) ordained by Allah, and Allah is full of Knowledge and Wisdom.” (Qur’an 9:60)
1. FUQARA: people who are poor and who possess more than their basic needs but do not possess wealth equal to Nisaab.
2. MASAKEEN: people who are destitute and extremely needy to the extent they are forced to beg for their daily food rations.
3. AL-AMILEEN: people appointed by an Islamic Government to collect Zakaat.
4. MU-ALLAFATUL-QULUB: persons who have recently accepted Islam and are in need of basic necessities who would benefit from encouragement by Muslims which would help strengthen their faith.
5. AR-RIQAAB: slaves who are permitted to work for remuneration and have an agreement from their masters to purchase their freedom on payment of fixed amounts.
6. AL-GHAARIMEEN: persons who have a debt and do not possess any other wealth or goods with which they could repay that which they owe. It is conditional that this debt was not created for any un-Islamic purpose.
7. FI-SABILILLAH: persons who have to carry out an obligatory deed which has become obligatory on them and subsequently (due to loss of wealth) are unable to complete that obligation.
8. IBN-US-SABEEL: persons who are travelers and during the course of their journey do not possess basic necessities, though they are well to do at home. They could be given Zakaat in order to fulfill travel needs to return home.
PERSONS WHO CANNOT BE GIVEN ZAKAAT:
1. Zakaat cannot be given to the descendants of Rasulullah (sallallahu alaihi wassallam);
2. Zakaat cannot be given to parents and grandparents. In the same manner one’s children and grandchildren cannot be given Zakaat. A husband and wife cannot give Zakaat to each other.
3. Zakaat contributions cannot be given to such institutions or organizations who do not give the rightful recipients possession of Zakaat, but instead use Zakaat funds for constructions, investment or salaries.
VIRTUES OF ZAKAAT:
Allah says in the Qur’an:
“The parable of those who spend their wealth in the way of Allah is that of a grain of corn. It grows seven ears and each ear has hundred grains. Allah increases manifold to whom He pleases.” (Qur’an 2:261)
It is stated in the Hadith that by giving Zakaat the following benefits are derived:
1. Gain the pleasure of Allah
2. Increase in wealth and protection from losses
3. Allah’s forgiveness and blessings
4. Protection from the wrath of Allah and from a bad death
5. A shelter on the Day of Judgment;
6. Security from seventy misfortunes