If you are looking to calculate your Zakat in 2021, we are here at your service. Zakat is an Islamic financial system referring to the obligation according to which a person has to donate a certain proportion of the wealth every year with the purpose of contributing to the financial balance in the society (Zakat Calculator 2021).
Zakat is a mandatory process for Muslims and is regarded as a form of worship.
According to Islam, giving a share from the wealth every year as Zakat to the poor is considered to purify the earnings that are over and above and can make certain financially weak families to fulfill their needs.
What is Nisab?
The Nisab is the term used for the minimum wealth or assets one must own before being eligible to start paying Zakat.
This minimum share is called the Nisab and one should pay Zakat only if the wealth is all according to the defined Nisab and its terms & conditions.
All the Muslims who meet the criteria of Nisab are supposed to pay Zakat one lunar year from the day their wealth exceeded the threshold.
What is the Rate of Zakat?
According to the latest updates, Zakat should amount to 2.5% or the 40th portion of the cash and tradable assets you possess above the Nisab. It is to be paid after an entire Islamic year has passed since the acquisition of these assets.
However, you can also pay it in advance if you have wealth equal to or above Nisab on hand.
Usually, the government of Pakistan announces the Nisab for each year before Ramadan.
Zakat Calculator 2021
Zakat Nisab is generally set according to the cash value of 3 ounces (87.48 grams) of gold or 21 ounces (612.36 grams) of silver.
Zakat on Gold
Zakat should be calculated at 2.5% of the market value as on the date of valuation (Lunar date).
Zakat on Precious and Semi-Precious Stones
If you have purchased the precious stone for a commercial purpose, only then the market value of these precious stones will be considered while calculating zakat.
Zakat on Silver
Zakat is to be paid on Silver in pure form or jewelry, utensils, decorative items, and all household items including crockery, cutlery made of silver at 2.5% of the prevailing market rates.
Zakat on Cash and Bank Balances
Zakat should be paid at 2.5% on all cash and bank balances in your savings, current, or FD accounts. The amount should be technically kept in the bank for one year. Usually, it happens that the balance keeps on changing as per personal requirements.
Zakat on Loans
Zakat is payable by you on loans you have given to your friends and relatives. It should also be treated as cash in hand.
However, if you are in doubt, on the return of your money, then you may not calculate it as your wealth. But you can add it to your wealth, if and when you receive your money.
Zakat is payable on all Govt Bonds, Public Sector Bond, Cash value of Takaful policies, your paid-up portion of BC/Committee (Bachat/voluntary contribution) which is not yet received, Govt Bills receivables, etc.
Zakat on Landed Property
Zakat is not payable on a personal residential house even if you have more than one and meant for residential purposes only.
Moreover, Zakat is not applicable on the value of the property given on rent irrespective of how many.
However, Zakat is payable on the rental income which remains with you till the date of Zakat.
In case if you have any intention of holding properties to sell in the future for profit or as an investment, then Zakat is payable on the Market Value of the property.
Conditions For Zakat Exemption
Zakat deduction will be exempted if met the following terms & conditions. Moreover, banks are not allowed to proceed with Zakat deduction on a compulsory basis if:
The account-holder is non-Muslim and the branch has a written affirmation to verify the claim.
The account-holder is not a Pakistani citizen and has provided a photocopy of their passport or an equivalent document proving their nationality.
The account belongs to a company where no less than 50% of the shares belong to non-Muslims or non-Pakistanis. The company would have to file the required attested documentation to prove the fact.
The account belongs to an individual who has claimed an exemption on the grounds of faith.
In that case, they would have to file a declaration or its attested photocopy. This must be done at least 30 days before the Valuation Date.
The account has been frozen by an established authority.
The account-holder did not have a balance exceeding the Nisab threshold for the entire year. They can file for exemption through the Local Zakat Committee at least 15 days before the Zakat Deduction date.
Who Can Receive Zakat?
The individuals who don’t have the cash or property as per the defined Nisab, they are considered to be eligible for receiving Zakat. You can pay Zakat to your relatives but not to your immediate family members, including your parents, grandparents, spouse, and children.
Moreover, the descendants of the Prophet (Peace Be Upon Him) are also not eligible to receive Zakat. As per the Holy Quran, the following have been considered eligible to receive Zakat:
Fuqara: The poor and needy who do not own any assets in excess of basic necessities.
Miskins: The extremely poor people who do not even own enough to fulfill their basic necessities.
Aamileen: The officials responsible for the collection and distribution of Zakat.
Muallafat-ul-Qulub: This refers to underprivileged Muslims. You can give them Zakat for the express purpose of making them more inclined towards Islam.
Fir-riqab: This term stands for the ’emancipation of slaves.’ You can pay Zakat to free a person stuck in a contract with a master who would only release them for a fixed sum of money.
Al-Gharimeen: The Muslims who are in debt.
Fi Sabeelillah: For any good deeds that would please Allah.
Ibn-us-Sabil: If a traveler needs money while traveling, they are entitled to receive Zakat.
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