# I |
ZAKAT ON PURE GOLD AND GOLD
Zakat should be calculated
on Pure gold and jewellery at a value as on the date of valuation, preferably
15th day of Ramadhan. There are different opinions on the value to be adopted
for valuation (i.e.,) purchase price or market price. Most of the Ulema have favoured
market value prevailing as on date of calculation of Zakat and not the purchase
price. The prevailing market rate of gold in India is taken as under for computation
of Zakat (Value as on 14th August 2011), Please verify market rate of gold or
silver on the date of calculation.
a) Pure Gold - 24 Carats at Rs.2,310 per gram or
Rs.23,100 per 10 grams.
b) Gold Jewellery
- 22 Carats at Rs.2,032 per gram or Rs. 20,320 per 10 grams.
c) Gold Jewellery
- 18 Carats at Rs.1,740 per gram or Rs.17,400 per 10 grams.
d) Gold Jewellery
- 14 Carats Rs.1,351 per gram or Rs.13,510 per 10 gram
(take the market value on the date
deduction of 2% from the weight of jewellery is allowed towards studded stones
as zakat is not payable on any kind of stones including diamonds, rubies, emeralds,
pearls etc. If there are rows of pearls or any other beads you have to make a
rough estimate and deduct 25% from the total weight of the article.
may deduct 4 gram from the total weight of the jewellery item if there is dory
(thread for tying at the back). For Kundan jewellery deduct 25% from the weight
for ' lac ' Zakat is payable on precious and semi-precious stones, if
are in the jewellery business.
: The amount receivable on credit sales is to be added to the total
value and the amount payable to your suppliers or loans taken, if any for the
business is to be deducted to arrive at the net value on which Zakat is due and
ANNEXURE # II
ON PURE SILVER, SILVER JEWELLERY, HOUSEHOLD ITEM ETC :
Zakat is payable on silver in pure form or in the form of jewellery,
utensils, decorative items and all household items including crockery, cutlery
made of silver at the prevailing market rates.
at the value of utensils & household items, 10% of the value is to be deducted,
as it is not pure silver. The prevailing market rate of Silver is to be taken
as under for computation of Zakat. Value as on 15th day of Ramazan.
a) Pure Silver @ 55,600 per Kg
b) Silver - Pure
and in the form of Jewellery at Rs.48,400/-per kg.
c) Silver utensils and
household items at Rs. 47,600/- per kg.
on jewellery should be paid by the owner of jewellery. If a woman is the owner
of the jewellery and has no liquid cash, her husband, son or father can pay the
Zakat on her behalf, but if they are also not paying, then the owner should sell
part of the jewellery and pay Zakat. If the jewellery is held by two or more persons
jointly, then the individual should calculate zakat on his / her share of the
jewellery and pay te sam if the value of individual's share exceeds 52.5 tolas
or Rs. 34,000/-
ANNEXURE # III
ZAKAT ON LANDED PROPERTY:
is not payable on the following properties:
Personal residential houses even if they are more in number meant for residential
b) Property given on rent irrespective of their number.
c) Agricultural land if meant for agriculture and farm house ( if any ) on agricultural
land, servants quarters, ....godowns, tractors, bullocks
and all implements for use at the farm.
d) Open land owned with the intention
of building a house in future for self or for the benefit of the family.
is payable on the properties held with the intention to sell at a future date
for a profit or as an investment. However, if your intention of holding the property
changes in the current year i.e., from self use business purpose, be honest to
Allah and pay Zakat on it at the current market value from the year your intention
If you have sold property that was meant for
business or have entered into an agreement of sale, Zakat on the balance of maoney
receivable, is to be paid. Any loans taken for purpose of property meant for business
hould be deducted from the net figure before calculating Zakat.
you are a builder and in property business (purchasing and sellin, purchasing
developing & selling) on all completed unsold portions you have to pay Zakat
at the prevailing market value. Zakat is also payable on amounts of installments
receivable on such portions after deducting loans or liabilities payable on the
Zakat is payable on property in the form of building,
shop, godown or land meant for property business, Zakat should also be calculated
on property meant for business. However, there is n zakat on property self occupied
for running you business like shops, show-room, godown, factory building, poultry
shed etc. If any property is held jointly by two or more persons the individual
must calculate zakat on his share in the property.
ON BUSINESS STOCK:
No matter what your business
is , you have to pay zakat on all stock-in-trade. The stock must be valued at
cost price (purchase price plus transport, insurance etc.)
If you have any
bills receivable from your customers you must add the same.
amounts are deductible from the above.
a) All amount due to
b) All loans on the date of calculation.
stock should also be taken into account at the discounted rate (i.e., if sold
in the open market by way of discount sale etc.) You should not calculate dead
stock at purchase rate or cost price. Damaged stock need not be taken for calculation.
Business stock includes old parts, scrap, car if in car business (excluding taxies,
lorries, pick-ups, autos meant for transport business). Hence zakat is payable
on all business stock after adding bills receivable and deducting bill payable.
By paying Zakat regularly you are creating an insurance on you stock.
ON FACTORY BUILDING MACHINERY AND GOODS PRODUCED :
There is no Zakat on factory building or on any kind of machinery,
But there is Zakat on products produced in the factory (finished stock). If there
is any loan or liability on the finished stock you should deduct the same for
calculation of the stock value. Similarly amount receivable on credit sales should
be added to the net stock. Bad debts should be deducted from net calculation.
Sometimes bad debts are recovered and you should pay Zakat on such recoveries
in the year of recovery only and not retrospectively. There is no Zakat payable
on vehicle used for personal transport and factory goods transport.
ZAKAT ON PARTNERSHIP FIRMS:
Zakat can be paid by the firm itself. But if the firm is not
paying zakat and partner wants to calculate Zakat on his share in the firm, he
should take the amount standing to his capital and loans given to partnership
as per last balance sheet. Add his share of profit till the date zakat is calculated
(This has to be estimated only as it is difficult to calculate the profit during
an accounting year). Deduct any loans or drawings taken by your from the firm
till date of calculation.
ZAKAT ON CASH AND BANK BALANCES:
Zakat is payable on all cash and bank balances in the form
of balance in savings account, current accounts of fixed deposits including monthly
income certificates or term deposits (remember any king of interest is haram in
Islam). The amount should be in the bank for one year, if the amount is utilized
for personal or any other use at the time of calculation of zakat, zakat payable
only on balance of amount. But if the amount has been withdrawn and is lying as
cash in hand, you should pay Zakat on both bank and cash balances added together.
Usually it happens that the balance keeps on changing as per personal requirement.
You may pay Zakat only on remaining amount on the date of calculation.
ANNEXURE # VII
ZAKAT ON LOANS, GOVERNMENT
BONDS, PROVIDENT FUNDS, LIC ETC:
is payable on loans advanced by you to your friends and relative. It should be
treated as cash in hand and Zakat is payable on it. You may deduct loans payable
by you (if any) for arriving at the net amount.
also payable on all government bonds such as Indira Vikas Patra, IDBI bonds, Units
and LIC paid up premiums and all such postal savings certificates. Zakat is also
payable on provident funds, earnest money deposits in the case of contractors,
tender deposits, government bills receivable, security deposits etc.
ON COMPANY SHARES AND MUTUAL FUNDS:
should pay Zakat on investment in company shares calculated at quoted value on
the date of Zakat calculation. If the shares of your company are not quoted in
any stock exchange then you may use the services of a chartered accountant to
arrive at the values. Similarly Zakat is payable on all Mutual Funds. Private
chits and chits funds. Your contribution in chit funds till the date of Zakat
calculation should be taken as your wealth. If you have withdrawn any amount then
the amount also should be added to your wealth, if the same is left over with
ANNEXURE # VIII
ON AGRICULTURAL PRODUCE:
payable on all agricultural produce including fruits, commercially grown flowers,
vegetables, and all types of grains at the time of harvest itself. The passing
of one year does not apply for agricultural produce.
On crops dependent on rain water only ushur is payable at 10% of the crop. You
can give the produce itself in kind or the cash value may also be given.
On crops produced with canal water, tank water or bore well
and open well, the ushur is 5% of the crop produced. There is no deduction out
of this on any account.
If land is partly
irrigated by rainwater, partly by well or canal water you make your own judgement
and calculate ushur. But the formula of average 7.5% would be fair and reasonable.
If there are two or more crops in a year on the same land,
you should pay ushur on all the harvests,
Note: Grains retained for self-consumption
is deductible before calculating ushur.
ZAKAT ON ANIMALS INCLUDING POULTRY
AND FISH FARMING:
On all grazing
animals like goats, sheeps, camels, cows of average size, the Zakat is one animal
on every 40 animals. But if the animal is of younger age (say less than 6 monthes)
even one animal out of 100 can be given. There is no Zakat on egg laying birds
and milk giving animals such as cow, buffalo etc. You can calculate and give zakat
in cash, in lieu or animals. In case of broiler chickens or fish farming you may
make your own judgement and calculate Zakat as there are no fixed norms.
40 to 120 goats / sheep
One goat / sheep of
a year or more
121 to 200 goats / sheep
Two goats / sheep
of a year or a more.
30 to 39 cows / buffaloes
One calf of a year
to 59 cows / buffaloes
One calf of not less
than two years old
60 cows / buffaloes
Two calves, each 1 year
additional 30 cows / buffaloes
One calf of
a year old.
every additional 40 cows / buffaloes
of two years old.
are deductible from net wealth/asset.
- If there is any income tax or sales
tax payable to Government on the date of calculation of Zakat, such liabilities
can be deducted before arriving at the net wealth.
Payment of income tax or sales tax does not fulfill your liability
towards Zakat and you cannot deduct income tax payment from your net Zakat. Only
tax liability if due on the date of Zakat calculation, is deductible from the
net asset. Zakat is apart from income tax and wealth tax payments. If you feel
that certain I.T. demand is disputed, unpaid and /or pending in appeal, you may
deduct the entire outstanding tax liability. But if the tax liability is reduced
in appeal of otherwise in future you have to pay Zakat on such savings for all
the years you have not paid Zakat. Allah is well aware of the facts and your intentions.
Chairman , Hyderabad Zakat &