Is zakaah due on bonuses?

The company for which I work gives fifteen days’ wages as a bonus at the end of every year of service, but this bonus comes at the end of the period of service. If I take this bonus after the end of the period of service, is zakaah due on it or not?.

Praise be to Allaah.

If the situation is as described, then no zakaah is due on that bonus until you receive it, and one year has passed from the time of receiving it. End quote.

Is zakaah due on business premises?

In 1996 I bought a shop for my brother to work in, but the shop has remained closed until now; my brother has not worked in it and I have not benefited from it. It did not enter my mind that zakaah may be due on it until recently. The price of the shop when I bought it was 400,000, then the price dropped to 300,000 in the year 2000. Now the price is between 700,000 and 800,000. In the coming year, in sha Allaah, I will try to open the shop so that someone can work in it and benefit from it.
 I hope that you can advise us as to whether zakaah is due on it or not. What can I do if I do not have enough money to pay zakaah?.

Praise be to Allaah.

The Muslim does not have to pay zakaah on his car, house or shop, even if the value of these things is great. Rather zakaah is due on things that are bought and sold for the purpose of trade and profit, which are called “trade goods”. If a person has any property or real estate – land, houses or shops – which he has acquired for the purpose of trade, buying and selling, then he should work out their value at the time when zakaah becomes due and pay one-quarter of one-tenth. But if a person has acquired that property to live in, or to farm it, or to rent it out or to buy and sell in it, then no zakaah is due on it. 

The scholars of the Standing Committee said: 

Wealth that people own is of various types. With regard to money, zakaah is due on it if it reaches the minimum threshold (nisaab) and one hijri year has passed. In the case of agricultural land, zakaah is due on the grains and crops on the day of the harvest, not on the land itself. In the case of land or buildings that are rented out, zakaah is due on the rent when one year has passed, not on the land or building itself. If the land, building or other goods are for trade, then zakaah is due on them when one year has passed, and you should pay zakaah on the profit when one year has passed for the capital, if the capital has reached the nisaab. End quote. 

Fataawa al-Lajnah al-Daa’imah, 9/331 

Based on this, you do not have to pay zakaah on this shop. 

And Allaah knows best.

Zakaah on monthly salaries and how is zakaah to be paid by one who is in debt?

I keep my money in the bank, as my monthly salary is deposited directly by my work, and I withdraw it to pay my expenses. I do not know the amount for which one year has passed, so that I can pay zakaah on it. I decided on the first on Ramadaan as the day for paying zakaah, by working out how much is in my bank account, even if the last payment of my monthly salary was deposited a few days before Ramadaan. 
I have two questions: 
1 – Is what I am doing to work out my zakaah valid? 
2 – I recently took a loan from my work to buy a house and I will be paying it off in monthly installments deducted from my salary during the coming year. Should I subtract the outstanding loan from the calculation for zakaah, knowing that I have savings in my bank account? For example, if I have savings of one hundred thousand riyals in the bank when Ramadaan comes, and the outstanding loan that I owe is seventy thousand riyals, what is the correct calculation?.

Praise be to Allaah.

Firstly: 

It is not permissible to put money in riba-based banks unless that is essential in order to protect it, so long as that is without interest. See the answers to questions no. 23346, 22392 and 49677. 

Secondly: 

If one full year has passed since you acquired the nisaab (minimum threshold) then zakaah must be paid immediately, and it is not permissible to delay it beyond that when one is able to pay. A person does not have the choice of selecting a particular month for paying zakaah on his wealth, rather that month should be after one year has passed, unless he is paying it in advance in Ramadaan, before the year has passed, in which case there is nothing wrong with it. But after the year has passed, it is not permissible to delay it until Ramadaan. 

See the answer to question no. 26716 and 8400. 

Thirdly: 

If you pay zakaah on all your wealth, even your monthly salary, this is safer and is the easiest way of paying zakaah on what you have saved of your salary. 

See the answer to question no. 26113 and 50801. 

Fourthly: 

We have already explained that riba (usury) is haraam, and it is haraam with regard to building and buying houses. If that loan is riba-based, then you must hasten to repent and get rid of it, seeking that which is with Allaah and fearing His punishment. 

See the answer to question no. 45951, 21914, 22905 

Fifthly: 

With regard to the zakaah of one who is in debt, the correct scholarly view is that the debt cannot be subtracted from the wealth on which zakaah is due. In the example which you mention, you have to pay zakaah on the full one hundred thousand, and you cannot subtract from it the debt that you owe. 

See the answer to question no. 65763, 22449 and 22426. 

And Allaah knows best.

He has a dagger and a revolver – is there any zakaah on them?

My father has a dagger and a licensed revolver. I want to ask: is there any zakaah due on them?.

Praise be to Allaah.

No zakaah is required of a person for what he owns of weapons, animals, clothing and the like, unless it is for trade. The evidence for that is the words of the Prophet (peace and blessings of Allaah be upon him): “No zakaah is due from the Muslim for his slave or his horse.” Narrated by Muslim (982). 

Al-Nawawi (may Allaah have mercy on him) said: This hadeeth is the basis of the principle that no zakaah is due on one’s own property, and no zakaah is due on horses and slaves if they are not for trade. End quote from Sharh Muslim. 

One's own wealth means that which a person keeps to make use of and benefit from, not for purposes of trade. On this basis, no zakaah is due on the dagger and revolver, unless they are prepared for sale, in which case zakaah is due on them. See also the answer to question no. 65515 for information on how to pay zakaah on trade goods. 

It should be noted that the dagger may be made of silver or plated with gold. If the gold or silver in it reaches the nisaab (minimum threshold) then zakaah is due on it; or if it is less than the nisaab but the owner has other gold or silver that reaches the nisaab when put together with it, then zakaah is also due on it. 

But if the gold or silver in it is less than the nisaab and the owner has no other gold or silver, then no zakaah is due on it. 

The scholars of the Standing Committee were asked: is a personal weapon such as a rifle, revolver or sword subject to zakaah, and how should it be paid? 

They replied: 

No zakaah is due on that because it is not prepared for trade. But if there is any gold on the sword etc that reaches the nisaab by itself or when added to other gold that he owns, then he must pay zakaah, according to the more correct of the two scholarly opinions, as is the case with jewellery. End quote. 

Fataawa al-Lajnah al-Daa’imah (9/276) 

And Allaah knows best.

Is it obligatory to pay zakaah on money loaned to someone who is going through difficulties or who is delaying repayment?

What is the ruling on paying zakaah on money loaned to someone who is going through difficulties and may take years to repay? What is the ruling on paying zakaah on money loaned to a rich man who is delaying repayment? What is the ruling on a loan given to someone who one knows is rich and will pay it back – of course, after one year has passed?

Praise be to Allaah.

If the debtor is going through difficulty or is rich but is delaying repayment, and it is not possible to get the money back from him, either because there is not sufficient evidence to get the matter resolved through the courts, or because one has evidence but the authorities will not help him to get it back, as is the cases in some countries where the authorities do not support people’s rights, zakaah does not have to be paid until the loan is recovered and one hijri year has passed. If, however, the debtor is rich and it is possible to recover the loan, then it is obligatory to pay zakaah on the money each time a year passes, if the loan reaches the level of nisaab either by itself or when added to one’s other money and other wealth.

Allaah is the Source of strength. May Allaah bless our Prophet Muhammad and his family and companions.

Zakaah on company shares

I hope that you can give me an idea about how to pay zakaah on shares, and if the company already pays zakaah, am I obliged to pay zakaah too?

Praise be to Allaah.  

The zakaah on shares is obligatory upon the owners of the shares. It may be paid on their behalf by the company if that is stated in the company’s constitution, or it is decided by the board of directors, or if the law of the land obliges companies to pay zakaah, or if the shareholder authorizes the company to pay zakaah on his shares. 

Secondly:

The company should pay zakaah on the shares just as an individual pays zakaah on his wealth, in the sense that all the money of the shareholders is to be considered like the wealth of one person, and zakaah is calculated on that basis, depending on the category of wealth on which zakaah is obligatory, the nisaab (minimum threshold), the amount on which zakaah is to be paid, and other matters which are to be taken into account with regard to the zakaah to be paid by an individual. This is based on the principle of khultah (collectivity), according to the fuqaha’ who apply this to all kinds of wealth, excluding the amount of shares on which zakaah is not obligatory, such as shares belonging to the public treasury, charitable waqfs, charitable organizations, and shares belonging to non-Muslims. 

Thirdly:

If the company does not pay zakaah on its wealth for any reason, then the shareholders are obliged to pay zakaah on their shares. If the shareholder can find out from the company’s statements how much the company would have to pay in zakaah if it did pay zakaah in the manner described above, then he should pay zakaah on that basis, because this is the basic principle with regard to paying zakaah on shares. 

If the shareholder is not able to find that out: 

If he holds shares in the company with the intention of benefiting from the annual profits of the shares, and not for the purpose of trading in those shares, then he should pay the zakaah similar to that paid on things that are rented out, in accordance with the resolution of the Islamic Fiqh Council (Majma’ al-Fiqh al-Islami) passed during its second session, with regard to the zakaah on real-estate and non-agricultural land that is rented out. The owner of these shares does not pay zakaah on the value of the shares, rather he pays zakaah on the profits, which is 2.5% after one year has passed from the day when he acquired that profit, bearing in mind the conditions of zakaah and provided that there are no impediments.

 If the shareholder bought the shares with the intention of trading, then the zakaah on the shares is the same as zakaah on trade goods. If one year has passed and they are still in his possession then he should pay zakaah on the value of the shares, based on the evaluation of experts, and he should pay 2.5% of that value and of the profit, if the shares have made any profit. 

Fourthly: 

If the shareholder sells his shares during the year, he should include their price in his wealth and pay zakaah on it after one year has passed. The purchaser should pay zakaah on the shares that he has bought in the manner described above. And Allaah knows best. 

Zakaat on income earned during the year

Aslam Al Akham
If one has us$ 10,000 above the nisab at the beginning of the Zakat year and by end of that year he earns another Us$ 5,000. Therefore making it US$ 15,000 . But the extra 5,000 have not been in his possession for a full zakat year. Is the Zakat then payable on the 10,000 only or on 15 ,000.
Please clarify.
Thank You

It is not obligatory that zakat be paid on wealth until after the year ends. This refers to the $10,000. That is unless the additional money, which has come after the beginning of the year is a result and proceeds from the original money. This would make this money have the same zakat status, and you would then have to pay zakat on the entire $15,000.