Zakah is payable on trading stock if their market value is equal to or more than the value of nisaab.
Definition of trading assets
Trading assets are those, which are purchased with the intention of resale or capital gain. Consequently, goods that have been purchased for personal use and not for the purpose of trade are not subject to Zakah, irrespective of their value. Similarly, goods (other than gold and silver) originally bought for personal use are not subject to Zakah if the purchaser subsequently intends to sell them for trade and had not intended it at the time of purchase. Once sold, however, their sale price would be subject to Zakah. Read more... (769 words, estimated 3:05 mins reading time)
The amount of Zakah payable is two and a half percent (2.5%), or 40th portion of:
1. the value of gold and silver if it is equivalent to nisaab or above it.
2. trading stocks, or its value at the time of obligation of payment of Zakah, if the stock is equal to nisaab.
3. cash on hand if equal to nisaab.
Zakah on gold and silver
• Gold and silver are subject to Zakah regardless of whether they are owned for personal use or otherwise if the weight thereof equals the prescribed nisaab and one year elapses thereon. Gold and silver are also always liable to Zakah irrespective of the asset type (gold bar, jewellery, ingot, coin etc.) Read more... (715 words, estimated 2:52 mins reading time)
Debts can be classified into two types:
- Receivables i.e. owed to oneself e.g. Loans given to somebody.
- Payable to others e.g. Money borrowed from somebody.
Debts receivable from others
There are different types of debt receivables. The ruling of Zakah for each kind of debt receivable is different from the other. It is therefore pertinent to first understand all these types of debts receivable.
Types of Debts Receivable
Imam Abu Hanifah (R.A.) has classified debts into three categories, namely: Read more... (506 words, estimated 2:01 mins reading time)
- Trade Debts
- Non-Trade Debts
- Other Debts