Zakat in Islam – A Comprehensive Guide for Muslims & Pilgrims

  • August 28, 2023

Zakat in Islam one of the five pillars of Islam. It is obligatory for all Muslims who meet the necessary criteria of wealth.

Zakat in Islam is an important act of worship and spiritual purification. Zakat requires Muslims to allocate a portion of their wealth to support the poor and needy.

In this comprehensive guide, we will cover the basics of Zakat in Islam. These include What Zakat Means, How Zakat Works, What is Zakat in Islam, Who is Eligible for Zakat, how to donate Your Zakat and many other details.

Understanding rules of Zakat in Islam allows Muslims to fulfill this religious obligation correctly and reap the spiritual rewards.

What is Zakat in Islam?

Zakat literally means “purification” in Arabic and it is also known as “Alms”. It refers to mandatory giving of a fixed portion of one’s wealth each year to help poor and needy.

Zakat is one of the five pillars of Islam. This means it is obligatory for all Muslims. The other pillars are:

  • The testimony of faith (shahada)
  • Five daily prayers (salat)
  • Fasting in Ramadan (sawm), and
  • Pilgrimage to Mecca (hajj)

The main purposes of Zakat in Islam are:

  • Purifying one’s wealth and possessions from excessive desire.
  • Helping the poor, needy, and indebted.
  • Redistributing wealth fairly in society.
  • Strengthening community ties.
  • Showing thankfulness to Allah for His blessings.

Therefore, Zakat is an act of worship, a financial obligation, and an important means of spiritual purification. Through Zakat, Muslims acknowledge that everything they own belongs to Allah.

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When Should I Pay Zakat?

Zakat is only obligatory for Muslims who meet the minimum threshold or Nisab. One must also be an adult and possess wealth for a full year.

The main conditions to be eligible for paying Zakat are:

  • Being Muslim: Non-Muslims do not have to pay Zakat. New converts pay Zakat for one year after conversion.
  • Being an Adult: Zakat is not required of minors or those who are mentally unstable. Their guardians pay on their behalf.
  • Being Free: Slaves are exempt from Zakat unless they voluntarily choose to pay it.
  • Owning the Nisab: Your wealth must exceed a minimum threshold called Nisab (discussed next).
  • Possessing wealth for one year: Zakat is only payable if you have maintained the Nisab for a full year.

So, in summary, every adult Muslim who owns wealth equal to or above the Nisab and has held this amount for one lunar year must pay Zakat.

What is Nisab for Zakat?

Nisab refers to the minimum amount of wealth one must have before being obliged to pay Zakat. The Nisab is calculated based on the market value of 87.48 grams of gold. Zakat is 2.5% of your total wealth above the Nisab amount.

How Do You Calculate Zakat UK in Euros?

Here are the current Nisab amounts based on gold prices:

  • Gold Nisab: 87.48 grams of gold = approx. £4800
  • Silver Nisab: 612.36 grams of silver = approx. £418
  • Cash Nisab: Value of 87.48 grams of gold = approx. £4800

Any wealth, be it gold, silver, cash, shares, or trade goods, is evaluated based on its current market price. It is then added together to determine your total wealth.

How Much Zakat Do I Need to Pay?

If your combined wealth exceeds the Nisab amount, only the surplus wealth above Nisab is subject to the 2.5% Zakat payment. Wealth below the Nisab is exempt.

The Zakat amount is quite simple to calculate. It is 2.5% of your total Zakatable assets above the Nisab amount.

For example:
Let’s assume your cash savings total as £8000
The Nisab for cash is £4800
So, your Zakatable amount is £8000 – £4800 = £3200
2.5% of £2500 is £80
Your Zakat due is £80

Zakat is only payable on the surplus wealth above Nisab. The Nisab amount itself is exempt from Zakat.

  • The key Zakatable asset classes are:
  • Cash, bank savings and pensions
  • Gold, silver and other jewelry
  • Shares, stocks and investment funds
  • Rental property and real estate
  • Inventory of goods for trade
  • Agricultural produce
  • Livestock, camels and cattle

Each asset class has specific rules for evaluation and payment that can be discovered in detail through scholarly books on Zakat. The calculation involves determining the current market value of all assets and deducting any debts and liabilities.

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When Should Zakat be Paid – Rules of Zakat?

The timing of Zakat is based on the lunar calendar. It is typically due after having wealth equal to or above the Nisab for one complete lunar year.

Zakat should preferably be paid during the month of Ramadan before Eid prayers. However, it can be paid anytime during the year.

Upon disbursing Zakat, the Zakat “year” resets and a new year starts for calculating the next year’s Zakat. Some key points on Zakat timing:

  • Lunar year: The 12 months of the Islamic calendar, approximately 354 days
  • No later than Ramadan: Ideally pay before Eid prayers
  • Anytime during the year: If missed Ramadan, pay as soon as possible
  • Reset calculation: Zakat year resets after paying annual Zakat

Paying Zakat in Ramadan also allows it to be disbursed to the poor before Eid. The month of giving and sharing is the best time for wealthy Muslims to fulfill this pillar of Islam.

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Can I Pay My Zakat in Instalments?

Muslim scholars usually recommend that if you have Zakatable amount above Nisab amount then pay Zakat in one go. However, if you cannot afford to pay the entire Zakat at one go then you can pay in instalments.

Who is Eligible to Receive Zakat Donations?

Zakat cannot be given to any random person or cause. The Quran has specified eligible recipients of Zakat funds. It is forbidden to misuse Zakat money on anything other than the authorized categories.

The eligible recipients of Zakat are:

  • The poor and the needy
  • Zakat administrators
  • New converts to Islam
  • To free slaves
  • Debtors
  • Travelers
  • In the path of Allah
  • Wayfarer

Muslims wanting to pay Zakat should disburse it directly to eligible recipients. If unable, Islamic centers usually have Zakat committees to collect and distribute funds to verified eligible recipients.

What are the Different Types of Zakat?

There are two main types of obligatory Zakat in Islam:

Zakat al-Maal: The annual Zakat on wealth. It is calculated at 2.5% of surplus wealth above the Nisab, held for one lunar year. This is the main Zakat obligation for those who meet the criteria.

Zakat-ul-Fitr (Fitrana): The Zakat paid during Ramadan by all Muslims before Eid prayers. This is described in detail later.

Additionally, the Quran mentions Zakat on agricultural produce harvested from land:

  • Ushr: 10% Zakat on produce watered naturally by rain
  • Khumus: 5% Zakat on produce from cultivated agricultural land

What is Zakat-ul-Fitr (Fitrana)?

Zakat-ul-Fitr, also called Fitrana, is a separate type of Zakat that is mandatory for every Muslim during the month of Ramadan.

The key rules of Zakat-ul-Fitr are:

  • Paid during Ramadan by all adult Muslims
  • Equal amount per person (adult or child)
  • Aims to purify fasts and provide Eid charity

The amount per person is typically the same as the amount given in Sadaqat-ul-Fitr, which is around £4 per person in the UK. This obligatory Zakat cleanses any indecent words or actions during Ramadan.

Fitrana should preferably be paid on or before the Eid-ul-Fitr prayers, directly to the poor and needy. The local mosque or Islamic center can also collect and distribute Fitrana to verified recipients.

What are the Benefits of Paying Zakat in Islam?

Apart from fulfilling a religious obligation, paying Zakat has many spiritual and societal benefits:

  • Purifies wealth and blesses sustenance
  • Fulfills an important pillar of Islam
  • Cleanses sins and builds good character
  • Creates social justice and equality
  • Redistributes wealth in the community
  • Helps the poor and needy survive
  • Builds bridges between the rich and the poor

On a personal level, paying Zakat instills empathy, gratitude, and discipline in managing wealth. Therefore, Zakat provides spiritual, financial and communal benefits.

How to Pay Zakat in the UK?

Muslims living in the UK can easily fulfill their Zakat obligation by following these steps:

  • Calculate Zakat: Evaluate your gold, cash, shares and other assets owned for one year. Deduct any debts.
  • Check Nisab: Verify that your total Zakatable assets exceed the minimum Nisab amount.
  • Determine amount: Calculate 2.5% of your Zakatable wealth above the Nisab. This is your Zakat amount.
  • Pay before Ramadan: Disburse to eligible recipients before Eid prayers. Get recipients’ details.
  • Use registered charities: Alternatively, donate to registered Islamic centers and charities providing Zakat services.
  • Ensure you receive a receipt for your Zakat payment. Keep Zakat organized and try to pay during Ramadan to gain maximum spiritual benefits.

Difference Between Zakat and Sadaqah You Should Know

When it comes to giving to charity, two big terms come to mind: zakat and sadaqah. Even though they both aim to help people in need and make society better, they’re also quite different.

Zakat in Islam – The Obligatory Almsgiving for Wealthy

Let’s break down zakat first. Zakat is charity that Muslims are required to give. It’s not voluntary like sadaqah. Zakat has strict rules about who has to give, how much they give, and who gets the money. The amount is based on a percentage of a person’s wealth. The idea is to spread the wealth around fairly.

Sadaqah: A Voluntary Act of Kindness

Now sadaqah is more flexible. It’s given voluntarily out of kindness. Givers can donate to any cause they want, whenever they want, in any amount. Sadaqah shows compassion and selflessness since givers give what they can to help.

Shared Objectives, Divergent Paths

While zakat and sadaqah work in different ways, their end goal is the same: helping the less fortunate and improving society. Zakat redistributes wealth as a religious duty. Sadaqah is voluntary charity that lets people make a difference as they wish.

The Compassionate Core Principle of Zakat & Sadaqah

At their core, both types of charity demonstrate caring and empathy. They let people look beyond themselves and lend a hand. Whether through zakat’s structure or sadaqah’s spontaneity, the heart is to build a more just and compassionate world.

Choosing the Path of Giving – Zakat or Sadaqah

When deciding on zakat or sadaqah, you make a choice about your values. Zakat highlights the duty to help the poor if you’re able. Sadaqah gives you the freedom to support diverse causes you care about.

Overall, zakat and sadaqah offer meaningful ways to impact society. Their shared goal of uplifting others unites them in purpose. Yet their different approaches let givers follow their own path in making a difference.


Zakat in Islam is an important act of worship that helps purify our wealth and assist the less fortunate.

By understanding the basic rules of Zakat, you can fulfill this religious obligation correctly and continue benefitting society. Paying the proper Zakat amount is one way to prove our thankfulness for Allah’s blessings upon you. In Sha Allah, may we all gain abundant rewards through this act of kindness and charity.

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How is Zakat calculated on jewelry?

Jewelry is evaluated at its current market value based on weight and gold/silver prices. Any jewelry below Nisab is exempt. The amount above Nisab is included in total assets to calculate 2.5% Zakat.

Should I pay Zakat on my house?

Houses meant for personal use are exempt from Zakat. If you have additional rental property held for investment, it will be subject to Zakat based on its current market value.

Can I deduct outstanding debts from Zakat calculation?

Yes, you can deduct any loans, credits cards or debts you owe from the calculation. Zakat is payable only on the surplus net amount after debt deductions.

How do I calculate Zakat on a joint account?

If the joint account is shared with your spouse or child, the entire balance is considered yours and Zakat is calculated on the total amount.

Can Zakat be paid on behalf of someone else?

Yes. You can pay Zakat on behalf of your dependents like children, parents or grandparents if they do not possess wealth equal to Nisab.

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