Zakat
Pay your Zakat as it is a happiness to your heart and Barakah to your money.
Zakat is due on gold and jewelry if they reach the Nisab, which is 85 grams or more, at 2.5%- one quarter of one-tenth of its value, and if it is owned or kept for commercial use for a whole lunar year. In case it is worn by women for adornment, there is a difference of opinion among scholars as to whether Zakat is due on it. However, it is better to pay Zakat on it to be on the safe side.
This Article Sheds Light On The Following
Rules of zakat on gold
1- Gold jewelry of women worn for adornment
Most scholars are of the view that if gold is worn by women for adornment, it is intended for personal use, so there is no Zakat on it.
Ibn Qudamah quoted Al-Khurqi’s opinion in Al-Mughni saying: There is no Zakat on jewelry of women if it is worn or lent. This was also narrated on the authority of Ibn Omar, Jabir, Anas, Aisha, and Asma, may Allah be pleased with them. The same opinion was held by Al-Kasim, Al-Sha’bi, Qatadah, Muhammad bin Ali, Amra, Malik, Al-Shafi’i, Abu Ubaid, Ishaq, and Abu Thawr.
Other scholars are of the opinion that Zakat should be paid on it. Thus, it is better to pay Zakat on it to be on the safe side.
Ibn Qudamah elaborated more on Al-Khurqi’s opinion saying: Zakat is not paid on jewelry if it is intended to be worn or lent; Zakat is due on jewelry kept for renting out or paying for living expenses in time of need; that is to say, Zakat is imposed on growth assets only, not on what is intended for personal use. Zakat is not waived in case jewelry is worn with the intention of being exempt from zakat.
2- Gold jewelry of women not worn or used
According to some scholars, there is no Zakat on jewelry of women if it is neither worn nor intended to be used or possessed.
An-Nawawi mentioned in Al-Majmu’ that if women own jewelry and have no intention of wearing, possessing, and keeping it as a treasure, or have the intention of renting it out, it is obligatory to pay Zakat on it, with reference to the rule that says it is obligatory to pay Zakat on gold jewelry that is used permissibly. Moreover, this could be looked at from another two points of view, of which the second is the most accurate one, which was accepted as authentic by Al-Mawardi, Al-Rafi’i and others. First, Zakat is not due on jewelry if it is lent without fees, as working cattle’s fess. Second, Zakat is due on jewelry because it is regarded as growth assets. Al-Mawardi said this opinion was held by Abu Abdullah Al-Zubairi, which was accepted as authentic by Al-Jurjani in Al-Tahrir.
How to calculate Zakat on gold
Calculating Zakat on gold could be done by weighing the gold one possesses using the jeweler’s gram weight scale. If pure gold reaches 85 grams or more on the day Zakat is due and a whole lunar year has passed on it, Zakat is payable at 2.5%, one quarter of one-tenth, either of the gold itself or paying out what equals its value.
Only Zakat on pure gold should be calculated, as there is no Zakat on other metals and gemstones mixed with it.
Nisab of pure gold mixed with other metals
Zakat is not due on gold unless it reaches Nisab and a whole lunar year has passed on it. Gold Nisab is 20 mithqals, which is approximately the equivalent of 85 grams of pure gold.
24-karat gold is pure gold, which is not mixed with other metals. Other than this, such as 21-karat gold is not pure for being mixed with other metals or gemstones, on which Zakat is not paid. So, for those who are in possession of gold that is not pure, such as 21-karat gold, they should calculate only what is pure of it. If pure gold weighs 85 grams it reaches Nisab; otherwise, there is no Zakat on it for not reaching Nisab.
The way to calculate the purity level of 21-karat gold, or any other karat scale, is to multiply weight in grams by karat value and then divide the total by 24.
For instance, to check the purity level of 21-karat gold weighing in grams 97 to know whether Zakat is due on it, multiply 97 by 21, and then divide the total 2037 by 24, to get the result 84.875; given that it is less than Zakat Nisab, which is 85 of pure gold, there is not Zakat on it.
Nisab of gold in cash
In principle Zakat should be paid of the gold itself. However, one could pay out to the poor in cash or so what equals its value, according to the market price when Zakat is due.
1 comment
Mohammed
Since gold jewellery held by a person includes making charge which is not considered by the jewellers who buy back the jewellery, how can I adjust the zakatable value of the used jewelry for the making charge? Is there any suggestion as to what % of the market value of new gold should be deducted ?