Zakat on Gold: Gold has Zakat applied when it exceeds 7.5 Tola, which is equivalent to approximately 87 grams, if a person owns more than this amount it will attract a 2.5% charge of Zakat. It is essential that a person consult a jeweller for the current value of gold, asking for the rate per tola that they are buying back at, and not the rate they are selling at, this is imperative as we are trying to determine the value of gold which a person possesses.
Zakat on Silver: Silver is liable for Zakat taxation when it reaches 52.5 Tola, which is equivalent to 610 grams. The Zakat then applied is the same as gold, a 2.5% charge will be applied to the entire amount. Again, in order to determine the value of silver you should consult a jeweller. Most jewellers will be able to inform you of the rates which they are buying silver back at.
Zakat on your Current account: Zakat on cash is calculated from the levels of silver, currently that figure is approximately £250. This means when your current account reaches £250 and then remains there for one calendar year having not fallen below this threshold, then it too be liable for Zakat of 2.5%. Zakat applies to money which has been loaned to someone else, but any money borrowed is exempt, therefore it will be taken into account, reducing the overall figure which a person owns, reducing the overall Zakat liability. In the case of current accounts, the figure which you will use is lowest amount the account had reached. So a person should go through their account for the entire year and find the point where the account had fallen to its lowest level and then work out 2.5% of that amount as this is what is owed in Zakat. In the case where that lowest figure has fallen below the £250 threshold then it will cancel the Zakat obligation. Then next time the figure rises again over £250 then that date will become the new point from which one calendar year has to pass before any Zakat will become liable again. This does mean that if the current account keeps falling below the threshold every month, then no Zakat is due from that person.
Zakat on your Savings account: Zakat on savings account will also become liable at £250, but since these accounts are not subject to significant fluctuations the method applied is different. If at the start of the year and end of the year the figure is the same or it reaches approximately the same level, then any drop in savings during the year will be ignored. Equally, if there has been an increase in the duration of the year then it too will become chargeable for Zakat. The opening and closing figures in savings accounts are more significant that the lowest figure, for as long as it does not fall below the threshold.
Zakat on Stocks and Shares: Stocks and shares should be calculated as a balance sheet. There will always be a balance between business cash and stocks, the increase in stocks should mean the reduction in cash, equally a reduction in stocks should reflect as an increase in cash. So these two areas will be calculated together. The balance of the stocks/shares and cash will be used as an overall figure. A 2.5% charge will then apply to that overall amount.
Zakat on properties and vehicles: Zakat is not charged against properties or vehicles which a person uses. Even If they exceed one house or one vehicle, or happen to be a high value property or car. These are things which are considered necessities of life and Zakat in only chargeable against those things which are surplus to one’s basic requirements.
If, however, any of these things are used in business, as in cases of property developers and car traders then they will attract Zakat as stocks and shares which has been explained above. If a person owns a property which will be required in future, like a parent buying a property for a child, then its overall value will not attract Zakat. However, if it is on rent for years at a time then the rental income be liable for Zakat.