How to Calculate Zakat: A Step-by-Step Guide

Want the answer for your own numbers? Use the free Zakat Calculator — it does every step below for you.

Zakat in brief

Zakat is an obligatory charity on wealth for Muslims who hold more than a minimum amount (nisab) for a full lunar year (hawl). On money, gold, silver and trade goods, the rate is 2.5% — one fortieth.

Step 1: Pick your zakat date

Your hawl starts on the day your wealth first reached nisab. Each year after that, on the same Hijri date, you calculate and pay. Many people choose a memorable date, such as 1 or 27 Ramadan, and keep to it. Use the gold and silver prices on that date.

Step 2: Add up your zakatable assets

• Cash at home and money in bank accounts
• Gold and silver (coins, bars, and — in the Hanafi school — jewellery you wear)
• Money owed to you that you expect to get back
• Business stock, valued at its sale price
• Shares and investments (scholars differ on the method; many count the market value of shares held for trading)
• Rental income you have saved (but not the rental property itself)

Not included: your home, car, furniture, clothes and tools you use for work.

Step 3: Subtract debts due now

Take off bills and debts that are due immediately — this month's rent, an unpaid invoice, a loan instalment now due. For long-term debts such as a mortgage, many scholars allow only the payments due in the coming year, or the current instalment. This is the area where views differ most, so ask a scholar you trust if the amount is large.

Step 4: Compare with nisab

Multiply the weight by the price per gram on your zakat date. Many scholars recommend the silver nisab for cash and mixed assets, because it is lower and so includes more people who can give. If your net wealth is below nisab, no zakat is due.

Gold nisab or silver nisab: why it matters

The two nisab values can be very far apart, because silver is much cheaper than gold. As an illustration, with pure gold at 27,000 per gram and silver at 300 per gram:

Someone holding 1,000,000 in savings would be above the silver nisab but below the gold nisab. On the silver basis, zakat of 25,000 would be due; on the gold basis, none. This is why the choice of basis is worth discussing with a scholar you trust, especially when your savings fall between the two figures.

Step 5: Pay 2.5%

Full worked example

The currency does not matter — rupees, riyals, taka, pounds or dollars all work the same way.

Zakat on jewellery: the main views

This is one of the best-known differences between the schools of thought:

• Hanafi school: zakat is due on gold and silver jewellery, including pieces worn regularly.
• Maliki, Shafi’i and Hanbali schools: many scholars hold that jewellery worn regularly, in normal amounts, is not zakatable. Jewellery kept as savings or investment is generally treated like other gold and silver.

Both positions are held by respected scholars. Follow the view of the school or scholar you normally rely on, and apply it consistently from year to year.

Savings that change through the year

Most people do not track a separate year for every deposit. A common practice is to keep one zakat date and, on that date, count everything you hold at that moment — savings, cash, gold and so on. Money that came in and was spent during the year is not counted, because it is no longer in your hands.

If your wealth dropped below nisab during the year, scholars differ on whether the year restarts. If this applies to you, it is a good question to ask.

A checklist for your zakat date

1. Note the Hijri date and check today’s gold and silver prices.
2. List bank balances, cash, and any money you expect to be repaid.
3. Weigh gold and silver, note the karat, and value the pure metal.
4. Value business stock at its sale price.
5. Subtract debts due now.
6. Compare the total with nisab, then multiply by 2.5%.
7. Record what you paid, to whom and when.

Special cases

• Livestock is paid in animals by herd size, not 2.5% — see the animals zakat calculator.
• Crops (ushr) are 10% or 5% at harvest, depending on irrigation — see the crops zakat calculator.
• Business owners value stock at sale price — use the trade zakat calculator.
• Zakat al-Fitr is separate: a small amount per person, paid before Eid al-Fitr.

When and how to pay

Pay as soon as it is due; delaying without reason is discouraged. Zakat goes to the eight categories named in the Quran (9:60), which include the poor, the needy, those in debt and travellers in need. Many people pay through a trusted mosque or charity that distributes zakat separately from general donations. Keep a note of what you paid and when.

This guide explains the common method. For complex cases — business partnerships, pensions, large debts — check with a scholar.

Run your own numbers in the zakat calculator, with the gold and silver calculators for metals.

Frequently asked questions