Zakah is Fardh (obligatory) upon a person who possesses the following five:

1. The person is a Muslim
2. The person is free i.e. not a slave
3. The person is sane
4. The person is mature i.e. has reached the age of 15 or, in the case of a male, has experienced a wet dream before the mentioned age. And in the case of a female has experienced menses or a wet dream before this age.
5. The person is the complete owner of such wealth which consists of the following four things:

1. The wealth is equal to the Nisab i.e. a specific amount fixed by the Shariah upon which Zakah becomes obligatory.
2. It is beyond the owner’s needs and necessities. Examples of necessities are clothes, furniture, utensils, a home, a car etc.
3. It is free from such debt which would be equal or even more than the amount of wealth which is currently in the owner’s possession.
4. It has the tendency to increase (whether in value or physically) such as gold, silver, cash, inventory, livestock (i.e. cattle, goats, sheep) camels and horses.

Once this particular individual becomes the owner of the mentioned type of wealth, he will be obliged to pay its Zakah after a complete LUNAR year elapses from the day this wealth came into his possession. The paying of Zakah before the year is completed is an optional act and is permissible according to the Shariah.

ZAKAH OF GOLD
Zakah becomes compulsory on gold within one’s possession when it amounts to 87.84 gm or more. Once a lunar year has elapsed from the day of possession, the owner will be obliged to give 2.5% of that gold or its equivalent in cash from the total amount of gold, in Zakah. It should be borne in mind that all gold objects will be accounted for while calculating the total amount of gold within ones possession e.g. raw gold, gold nuggets, gold jewelry, gold utensils etc.

ZAKAH OF SILVER
Zakah becomes compulsory on silver within one’s possession when it amounts to 612.36 gm or more. Once a lunar year has been completed from the day this silver came within the owner’s possession, the owner will be required to pay 2.5 % of that silver or its equal value in cash from the total amount, in Zakah. Likewise, similar to the Zakah of gold, all silver objects will be accounted for while calculating the total amount of silver within one’s possession.

ZAKAH OF INVENTORY (stock)
A tradesman will assess his inventory based on the Nisab. Thereafter he will calculate the Zakah by deducting 2.5% and discharge it accordingly in order to benefit the needy even more.

ZAKAH OF SAVINGS
A person with savings will calculate the Zakah that is due from it by deducting 2.5%.

WHO IS ENTITLED TO ZAKAH?
In the light of the 60th verse of Surah at-Tawbah, we have been instructed to pay/discharge Zakah only to the following people:

1. A poor person who has very little wealth to the extent that it is less than the ‘Nisab’.
2. A needy person who has no wealth at all.
3. A person who has been employed to collect Zakah for the Islamic state. (in an Islamic country such a person’s wages for his services will be paid to him from the Zakah fund).
4. A person whose heart needs to become connected to the religion of Islam.
5. A slave who has agreed to pay to his/her master a fixed amount of money in return for their freedom.
6. A person who is in debt and does not have enough funds to pay off that debt.
7. A person who intends to go in the path of Allah but does not possess the required funds for it.
8. A traveler who does not have sufficient money to reach home with.

All of the above must be Muslims and cannot be from the descendants or ascendants whether paternal or maternal of the person paying Zakah.

These are some of the basic rulings of Zakah. For more details regarding the regulations of Zakah you are encouraged to refer to ‘Heavenly Ornaments’ (Bahishti Zewar) by Ml Ashraf Ali Thanwi RA or Ma’ariful Quran vol. 4 under verse 60 of Surah at-Tawbah by Sh. Mufti Muhammad Shafi RA.