Zakat is one of the major religious duties in Islam. Literally, zakat means to “purify”. It refers to the purification of a Muslim’s wealth and soul. Wealth purification denotes the mobilisation of assets for the purpose of financial growth and justified distribution. Purification of the soul implies freedom from hatred, jealousy, selfishness, uneasiness and greed. Other Quranic connotations include the purification of sin. Technically, zakat is a fixed proportion collected from the surplus wealth and earnings of a Muslim. It is then distributed to prescribed beneficiaries and for the welfare as well as the infrastructure of a Muslim society in general. This contribution is made payable by a Muslim once in every lunar year (Islamic Calendar/Hijri).
Zakat is paid on the net balance after a Muslim has spent on basic necessities, family expenses, due credits, donations and taxes. Every Muslim male or female who at the end of the Hijri year is in possession of the equivalent of 85 grammes of gold or more in cash or articles of trade, must pay his or her zakat at the minimum rate of 2.5 percent. Zakat has a deep humanitarian and social-political value. This religious act prevents the hoarding of wealth and advocates solidarity among Muslims because excessive wealth is distributed amongst the poor. The paying of zakat also helps purify one’s soul and encourages a Muslim to have gratitude towards God’s bounties.
As it has been mentioned, zakat is mentioned vis-à-vis with Salat (prayer) in 30 verses of the Holy Quran. It was first revealed in Surah Al Muzzamil: 20; “…. and establish regular prayers and give regular charity; and loan to Allah a beautiful loan. And whatever good ye send forth for your souls, ye shall find it in Allah’s presence, Yea, better and greater in reward and seek ye the grace of Allah: for Allah is oft-forgiving, Most Merciful.”
In another verse, Allah declares that those who pay zakat, are included within the Muslim society (Jamaatul Islamiah) – At Taubah: 11 God Most High said: They were enjoined only to worship God, sincere in their faith in Him alone – and of upright religion – and to establish the Salat and the Zakat. Such is the upright religion, (98:5) and: Those who lay up treasures of gold and silver and spend them not in the way of God; give them the news of a painful punishment, on the Day when that (wealth) will be heated in hellfire, and their foreheads and their sides and their backs branded therewith:
“This is the treasure which you laid up for yourselves! Taste, then, your hoarded treasure!” (9:34-35) and: Let not those who are miserly with what God has given them of His bounty think that this is good for them. Rather, it is bad for them. That which they withhold shall be hung around their necks on the Day of Arising. (3:180) “This is the treasure which you laid up for yourselves! Taste, then, your hoarded treasure!” (9:34-35) and: Let not those who are miserly with what God has given them of His bounty think that this is good for them. Rather, it is bad for them.
That which they withhold shall be hung around their necks on the Day of Arising. (3:180). If they respond to this, then teach them that God has imposed five Salats upon them in every day. If they respond to this, then teach them that God has imposed upon them a charity to be taken from the wealthy amongst them and given to their poor. If they respond to this, then beware of taking any more of their wealth! Beware also of the prayer of the oppressed, for there is no veil between such a prayer and God.”
Bukhari relates on the authority of Abu Hurayra that the Prophet (PBUH) said: “Whoever is given wealth by God and does not pay the Zakat due thereupon shall find that on the Day of Arising it is made to appear to him as a hairless snake with two black specks, which chains him, and then seizes him by his jaw and says, ‘I am your wealth! I am your treasure!’” Then he recited the verse, ‘Let not those who are miserly with what God has given them of His bounty think that this is good for them. Rather, it is bad for them. That which they withhold shall be hung around their necks on the Day of Arising.’ (3:180)
Conditions for zakat
Several conditions must be fulfilled before zakat can be paid. These conditions are necessary as zakat can only be applied on those who are of legal age and who own enough assets. These conditions are categorised into two broad categories, namely performer and asset. Every Muslim who is of a certain age and owns enough assets is required to pay zakat. Zakat Asset. Full Ownership – A Muslim will only be required to pay zakat if he or she has full and legal ownership of an asset.
Zakat is payable only on those assets that are acquired for the purpose of creating or generating wealth. Some examples of this type of assets are livestock or crops that are traded or sold, inventory of goods used for trading, and investments such as gold or securities that have potential for appreciation in value. However, zakat is not payable in the case of fixed assets such as buildings, if they are not subjected to “capital circulation”. Assets that exceed a minimum value Zakat need only be paid on those assets that exceed a minimum value. This minimum value is calculated based on the market price of 85 grams of gold or 595 grams of pure silver. This minimum value is termed Nisab. The Islamic Fiqh and Research Councils, as well as majority of Ulama’ recommend that gold be used as the basis for the calculation of nisab.
Completion of haul
Haul is defined as the completion period for a zakat asset. The length of time for haul is one Islamic or Hijri year (1 year Hijri = 354.5 days, 1 year Solar = 365.25 days). Zakat is only payable on assets that have been held for at least this period.
Beneficiaries of Zakat. The Holy Quran (Sura Al Tauba: 60) classifies the due recipients of zakat under the following eight categories. “Zakat is for the poor, and the needy and those who are employed to administer and collect it, and the new converts, and for those who are in bondage, and in debt and service of the cause of Allah, and for the wayfarers, a duty ordained by Allah, and Allah is the All- Knowing, the Wise”.
Zakat can only be distributed to any of the eight eligible beneficiaries (asnaf) that are mentioned in the Quran, At Taubah: 60. However, priority should be given to the poor and needy. Where there is no central authority to administer zakat, it can be paid directly to the needy. “Alms are for the poor and the needy, and those employed to administer the (funds); for those whose hearts have been (recently) reconciled (to the truth); for those in bondage and in debt; in the cause of Allah; and for the wayfarer: (thus is it) ordained by Allah, and Allah is full of knowledge and wisdom.” At Taubah : 60