ZAKAT
SIMPLIFIED
CA Abdul Rahim
Ramadan 1440 (May 2019)
Kolkata, India
Today’s agenda
• Basics of Zakat
• Zakatable Assets?
• Valuation of Zakatable Assets
• Case Study of Zakat Valuation
• Zakat Payable by Whom?
• How to pay Zakat
• Who is Eligible to Receive Zakat?
• The Spirit of Giving
• Making Zakat More Effective
Zakat Simplified Workshop
Basics of Zakat
The Wisdom of Zakat
•Purity
• In Wealth and Heart (Detachment)
•Balances Inequity
• In Society through Wealth Transfer
•Brotherhood
• Feeling of being part of one Ummah
•Best investment
• For Allah will give many times its reward
Zakat Simplified Workshop
Annual
Income
Annual
Saving
CONCEPTUAL CLARITY OF ZAKAT
Minus: Expenses
08-05-2019 Zakat Simplified Workshop
Every year we earn
some income and incur
some expense. What
remains after that is
our Annual Saving.
Annual Savings
of Various Years
Total
Wealth /
Assets
Zakat-
able
Assets
CONCEPTUAL CLARITY OF ZAKAT
Zakat Simplified Workshop
Annual Savings of Various years are
stored or Invested in various forms.
These become our Wealth / Assets.
Of these, only a few are ‘Zakatable’
i.e. Zakat is to be paid on them.
Zakat-
able
Assets
CONCEPTUAL CLARITY OF ZAKAT
NISAAB
CHECK IF…
Zakat Simplified Workshop
Calculate the value of your Zakatable Assets. If
they Exceed the threshold (Nisaab), then only
you are required to pay Zakat.
Zakat-
able
Assets
CONCEPTUAL CLARITY OF ZAKAT
NISAAB
CHECK IF…
Zakat Simplified Workshop
Zakat@
2.5% of
Zakatable
Assets
If Yes
If your Zakatable Assets are more
than the threshold (Nisaab), pay
2.5% of the Zakatable Assets as
Zakat.
Some Basics
• Zakat = (Minimum) Obligatory
Charity
• Paid Annually (every lunar
year, not solar year)
• On few owned asset items
(Zakatable Assets)
• Valued as per market price
(revalued every year)
• Can be given to specified
people only
• Err on the side of safety
Zakat Simplified Workshop
Zakatable
Assets
Zakatable Assets – Only 6 Categories!
Zakat Simplified Workshop
Gold & Silver Cash & Equivalent Trade Stock
Livestock Agriculture Produce Buried Treasure /
Mines
Since Livestock, Agriculture and Treasure / Mines are generally not
found in cities, we limit this presentation to the first 3 items.
Zakat on Gold
& Silver
Zakat on Gold &
Silver
• Payable on ALL Gold & Silver
owned (in use, not in use,
decorative etc.)
• Rate will be as on date of
Valuation, in city where asset is
• In case trader in Gold & Silver,
Zakatable but as ‘Trading Stock’
– no double zakat
Zakat Simplified Workshop
Calculating Zakat on
Jewellery
• Calculation based on
weight
• Exclude weight of
diamonds, pearls, precious
stones, platinum, Rubies
etc.
Zakat Simplified
Valuation of Gold & Silver
• Take Value of 24 carat Gold (per gram)
• Value of 22 carat gold is 22/24 of 24
carat value
• Value of 18 carat gold is 18/24 of 24
carat value
• Ignore workmanship, design costs etc.
• Silver take rate per Kg (as available in
market)
• Apply to all silver assets
• Ignore other costs such as design etc.
Zakat Simplified Workshop
Gold and
Silver Rates
on 1 Ramadan
1440 AH in
India (7 May
2019)
Zakat Simplified Workshop
Gold (24 Carat)
per gram:
Rs.3,180
Gold (22 Carat)
per gram:
Rs.2,915
Gold (18 Carat)
per gram:
Rs.2,385
Silver per Kg:
Rs. 37,500
Zakat on Cash
& Equivalents
Include all Cash and
Bank Balances
• Cash (even if separated for Haj etc)
• Bank Balance – Current Account
• Bank Balance – Savings Account
• Exclude Interest
• Bank Balance – Overdraft (Loan) Account
• If balance positive, include
• If negative (i.e. loan taken), minus as
payable
• Fixed Deposit / Recurring Deposit
• Include principal (not interest)
• Wallets (Paytm / JioMoney)Zakat Simplified Workshop
Treatment of
Debtors (Receivable)
• All Debtors (Amounts due and Loans Given)
are to be included as Zakatable Assets
• Advance for Flat also (until flat transferred)
• If amount is not recoverable
• If sure of non recovery (written off),
need not include
• If recovered later, pay Zakat in the year
of recovery.
• If amount is doubtful of recovery
• Zakat is payable every year, but can be
deferred until amount is received.Zakat Simplified Workshop
Treatment of
Insurance / LIC / PF
• Your amount kept with them is
Zakatable
• Employer’s contribution in PF is
also your right, so to be
included
• Any INTEREST included /
accumulated is NOT to be
included
• If any (halal) DIVIDEND is there,
it should be added Zakat Simplified
Treatment of
Creditors (Payable)
• Creditors to be deducted
• Reduce all business creditors that
remain, at end of year
• Loans to be deducted
• Loans for business / stock in trade to
be deducted
• Loan for Fixed Assets (such as home /
factory / shop)
• Better not to deduct - as such assets are
not Zakatable
Zakat Simplified Workshop
Zakat on
Trade Stock
What is Trade Stock
• Covers ANY item kept for resale
• Even a Flat if bought intending to
sell it
• Even a car if you are a car dealer
• Covers shares, Mutual Funds etc.
• Depends on initial Niyah when
purchased
Zakat Simplified Workshop
Zakat on Trade Stock
• Covers Raw material, Work in Progress
Stock, Finished Goods, Trading stock
• Tools of trade / machines not covered
• Shops / offices / factories not covered
• Damaged, Obsolete, Dead Stock
• To be included if can be sold
• Stock in Transit – to be included if FOB,
not if CNF
• My Stock in Other’s Godown - Include
• Other’s Stock in my godown (ex. Agent)
– Not to Include
Zakat Simplified Workshop
Valuation of Trade
Stock for Zakat
• Normal Goods
• Value as per market rate
• For Raw material, will be cost price
• Can use bulk / wholesale rate
• Damaged / Obsolete / Dead goods
• At (discounted) market rate
• May need to stop inventory
transactions for some time to
determine balance for Zakat
Zakat Simplified Workshop
Zakat on Shares and
Debentures (Trade Stock)
• Public Listed Shares
• Value as per Market Rate (BSE / NSE)
• Unlisted / Private Shares
• If company managed by you, treat as
separate unit and pay Zakat on it fully
• If not your own company
• Value from last available account
• 2 options – take all assets or only
Zakatable Assets
Zakat Simplified Workshop
Zakat on
Businesses
Zakat on Sole
Proprietorship
• Since Sole Proprietorship /
One Person Company
(OPC) means only one
person is the owner,
identify all Zakatable assets
of sole proprietorship and
include in your own Zakat
Calculation under
appropriate heads.
Zakat Simplified Workshop
Zakat on Partnership
Firm
• Calculate value of Zakatable Assets (Gold,
Silver, Cash equivalents and Stocks) held
by partnership firm / LLP
• Identify firm’s liabilities which are eligible
to be deducted
• Arrive at Zakatable Value
• If all partners are Muslims
• Pay 2.5% of this value as Zakat
• If all partners are not Muslims
• Calculate and pay proportionate share
Zakat Simplified Workshop
Zakat on Private
Company
• Calculate value of Zakatable Assets (Gold,
Silver, Cash equivalents and Stocks) held
by the Company
• Identify company’s liabilities which are
eligible to be deducted
• Arrive at Zakatable Value
• If all shareholders are Muslims
• Pay 2.5% of this value as Zakat
• If all shareholder are not Muslims
• Calculate and pay proportionate share
Zakat Simplified Workshop
Some
Examples...
My factory
- NOT
ZAKATABLE
Zakat Simplified Workshop
My
showroom
- NOT
ZAKATABLE
Zakat Simplified Workshop
My Home
- NOT
ZAKATABLE
Zakat Simplified Workshop
My Farms
- NOT
ZAKATABLE
Zakat Simplified Workshop
Additional
house
- NOT
ZAKATABLE
Zakat Simplified Workshop
My home items above -
NOT ZAKATABLE
Zakat Simplified Workshop
Zakat Payable
by Whom?
Conditions for Zakat
• Muslim
• Baligh (i.e. Adult)
• Aaqil (i.e. of sound mind)
• Owner & Possessor of the
Property
• Completion of one lunar
year (called Haul)
• Sahib-e- NIsaab
Zakat Simplified Workshop
Sahib-e-Nisaab
• Gold – 87.48 grams (7.5 Tola)
• Silver – 612.32 grams (52.5 Tola)
• Cash or Trade Stock equivalent
• Any combination of these
Nisaab (7 May 2019, India)
Based on Silver : Indian INR 22,900
approx
Based on Gold (24 ct): INR 2,78,000
approx
It is recommended to pay Zakat if you are eligible by the
lower of these 2 thresholds (Nisaab)
Zakat Simplified Workshop
Sahib e Nisaab
Zakat Simplified Workshop
If
Is More Than Rs. 22,900
Then Pay Zakaat @ 2.5% of TOTAL VALUE
(not minus Nisaab)
If your Zakatable assets are above Nisaab for full year,
pay Zakat on Zakatable Assets at year end (red column –
12th month).
Zakat Simplified Workshop
Lunar Month 1 2 3 4 5 6 7 8 9 10 11 12
NetZakatable
Assets
Nisaab
Zakat
Payable
on
If your Zakatable assets are above Nisaab for full year, pay
Zakat on Zakatable Assets at year end (red column – 12th
month) even if there is an extra asset at end of year
Zakat Simplified Workshop
NetZakatable
Assets
Nisaab
Zakat
Payable
on
Lunar Month 1 2 3 4 5 6 7 8 9 10 11 12
If your Zakatable assets are above Nisaab for full year, pay
Zakat on Zakatable Assets at year end (red column – 12th
month) even if it is lower than during the whole year.
Zakat Simplified Workshop
NetZakatable
Assets
Nisaab
Zakat
Payable
on
Lunar Month 1 2 3 4 5 6 7 8 9 10 11 12
What to do with
Interest?
• Better not to deal with interest.
• If, even then, have interest receipt:
• Take it out from your bank account
• Don’t use it for religious activities
• Give it away for charitable
activities (without expectation of
reward)
• Use it for activities like toilets
construction, public cleaning etc.
Zakat Simplified Workshop
How to Pay
Zakat
Hurry to pay Zakat
• Once liability of Zakat is
ascertained, it is the duty of
the owner of the asset to pay
Zakat immediately.
• Someone else (like husband on
behalf of wife) can pay, if asked
/ permitted by wife.
• Better to encourage them to pay
on their own
• Not having liquid assets is NOT
permissible excuse.
Zakat Simplified
Paying Zakat
• Form
• In Cash
• By Cheque
• Stock Items
• Damaged / Obsolete Stocks?
• An Asset
• Means of Delivery
• Directly to Beneficiary
• Indirectly through Agency
Zakat Simplified
Who to Pay
The person who is given Zakat Should be :
• ELIGIBLE for Zakat
• Made complete OWNER of amount
• given GRATIS (i.e. Not for work done)
• Given not only in Ramadan; round the
year
If Zakat is given in non-cash form (medicines /
clothes / food), full ownership is must (ex. food
packet instead of invitation to eat)
Zakat Simplified Workshop
Neeyah of Zakat
Intention in Heart made
If Segregated
• At time of segregation
If Direct Payment
• At time of payment to recipient
• After payment, until it is with
recipient
If Payment Through Agent
• At time of payment to agent
• After payment, until it is with agentZakat Simplified Workshop
Who is Eligible
to receive
Zakat?
Wealth / Assets
Non-
Essential
Assets
WHO IS ELIGIBLE TO RECEIVE ZAKAT?
Zakata
ble
Assets
Zakat Simplified Workshop
To determine
eligibility for Zakat,
identify the
Zakatable Assets
and Non-Essential
Assets that the
person has in his
total wealth.
Non-
Essential
Assets
WHO IS ELIGIBLE TO RECEIVE ZAKAT?
Zakata
ble
Assets
NISAAB
How to Verify: Taharri
Zakat Simplified Workshop
If the value of Non-Essential Items and Zakatable Assets is less
than Nisaab (threshold), then he is eligible to receive Zakaat.
However, the way to assess this is by ‘Taharri’ i.e. based on
our perception of his financial position, not by an inspection.
It is better to have a soft / lenient approach toward this.
Eligible
recipients for
Zakat
1. Faqeer: poor; one who has some
money, but not sufficient for his
basic needs
2. Miskeen: destitute; one who has
nothing
3. Amileen: zakat collector,
appointed by the Caliph
4. Mu'allafah Qulubuhum : to
soften the hearts
Eligible
recipients for
Zakat
5. Riqaab: to slaves to purchase
their freedom
6. Gharim : one in debt for a
legitimate reason
7. Fi Sabeelillah: in the path of Allah
8. Ibnis-Sabeel: wayfarer; one
stranded away from home, with
no money available to him
Those who
cannot be
given Zakat
• Non-Muslims
• But we can and
should give non-
obligatory charity
(Nafil Khairaat) to
them
• Employee or
Labourer, as
wages
• Well-off people
• Relations of birth –
upward and downward
• (i.e. mother, father, son,
daughter, grandfather,
grandson etc). Such
people if needing
support should be
helped, but not from
Zakat.
• Other relations such as
brother, sister, uncle,
daughter-in-law,
mother-in-law can and
should be given Zakat as
first priority.
Zakat Simplified Workshop
Those who
cannot be
given Zakat
(Cont’d)
• Relations of marriage
• Husband and wife
cannot give Zakat to
each other but can
give other (non-
Zakat) amounts.
• Children of the family
of Bani Hashim
• Prophet Muhammad
(SAWS)’s family,
Hazrat Ali (RA)’s
family etc.
• An organisation /
institution (except
as agent)
• Even NGOs,
hospitals etc. accept
Zakat as agents
Zakat Simplified Workshop
Zakat Etiquette
• Seek out the deserving
• Give to (permitted)
relatives first
• Give with humility
• Pay in secret, preferably
• Need not explicitly mention
it is Zakat
• Don’t remind them of it
08-05-2019
The Spirit of
Giving
Don’t limit your Charity only to
Zakat
Let your hearts be detached from
wealth
Let giving be your way of investing
with Allah
Let us acknowledge that all we
have is received from Allah and to
be routed to his creation –
through Us!
ِ‫ق‬ْ‫ال‬ َ‫م‬ ْ‫و‬َ‫ي‬ ُ‫ل‬‫و‬ُ‫ق‬َ‫ي‬ َّ‫ل‬َ‫ج‬ َ‫و‬ َّ‫ز‬َ‫ع‬ َ َّ‫اَّلل‬ َّ‫ن‬ِ‫إ‬ََِِ‫م‬َ‫ي‬:
َ‫ق‬ ‫ي‬ِ‫ن‬ْ‫د‬ُ‫ع‬َ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ ُ‫ْت‬‫ض‬ ِ‫ر‬ََ ،َ‫م‬َ‫د‬‫آ‬ َ‫ْن‬‫ب‬‫ا‬ ‫م‬َ‫ي‬َ‫ل‬‫م‬:َ‫ُك‬‫د‬‫و‬ُ‫ع‬َ‫أ‬ َ‫ْف‬‫ي‬َ‫ك‬ ِِّ‫ب‬َ‫ر‬ ‫م‬َ‫ي‬
َ‫ل‬‫م‬َ‫ق‬ ‫؟‬َ‫ين‬ََِ‫ل‬‫م‬َ‫ع‬ْ‫ال‬ ُّ‫ب‬َ‫ر‬ َ‫ت‬ْ‫ن‬َ‫أ‬ َ‫و‬:َِْ‫ل‬َ‫ع‬ ‫م‬َََ‫أ‬‫م‬ً‫ن‬ َ‫َل‬ُ‫ف‬ ‫ي‬ِ‫د‬ْ‫ب‬َ‫ع‬ َّ‫ن‬َ‫أ‬ َ‫ت‬
َ‫ك‬َّ‫ن‬َ‫أ‬ َ‫ت‬َِْ‫ل‬َ‫ع‬ ‫م‬َََ‫أ‬ ‫؟‬ُ‫ه‬ْ‫د‬ُ‫ع‬َ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ َ‫ض‬ ِ‫ر‬ََِ‫ع‬ ‫ي‬ِ‫ن‬َ‫ت‬ْ‫د‬َ‫ج‬ َ‫و‬َ‫ل‬ َُُ‫ت‬ْ‫د‬ُ‫ع‬ ْ‫و‬َ‫ل‬ُ‫ه‬َ‫د‬ْ‫ن‬.
َ‫م‬َ‫د‬‫آ‬ َ‫ْن‬‫ب‬‫ا‬ ‫م‬َ‫ي‬:ِ‫ع‬ْ‫ط‬ُ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ َ‫ك‬ُ‫ت‬ََْ‫ع‬ْ‫ط‬َ‫ت‬ْ‫س‬‫ا‬َ‫ل‬‫م‬َ‫ق‬ ،‫ي‬ِ‫ن‬َْ:َ‫ْف‬‫ي‬َ‫ك‬ َ‫و‬ ِِّ‫ب‬َ‫ر‬ ‫م‬َ‫ي‬
َ‫ل‬‫م‬َ‫ق‬ ‫؟‬َ‫ين‬ََِ‫ل‬‫م‬َ‫ع‬ْ‫ال‬ ُّ‫ب‬َ‫ر‬ َ‫ت‬ْ‫ن‬َ‫أ‬ َ‫و‬ َ‫ك‬َُِ‫ع‬ْ‫ط‬ُ‫أ‬:ْ‫ط‬َ‫ت‬ْ‫س‬‫ا‬ َُُّ‫ن‬َ‫أ‬ َ‫ت‬َِْ‫ل‬َ‫ع‬ ‫م‬َََ‫أ‬َ‫ك‬َََ‫ع‬
َِْ‫ل‬َ‫ع‬ ‫م‬َََ‫أ‬ ‫ُ؟‬َُِْ‫ع‬ْ‫ط‬ُ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ ٌ‫ن‬ َ‫َل‬ُ‫ف‬ ‫ي‬ِ‫د‬ْ‫ب‬َ‫ع‬َ‫ل‬ َُُ‫ت‬ََْ‫ع‬ْ‫ط‬َ‫أ‬ ْ‫و‬َ‫ل‬ َ‫ك‬َّ‫ن‬َ‫أ‬ َ‫ت‬َ‫ت‬ْ‫د‬َ‫ج‬ َ‫و‬
‫ي‬ِ‫د‬ْ‫ن‬ِ‫ع‬ َ‫ك‬ِ‫ل‬َ‫ذ‬.
َ‫م‬َ‫د‬‫آ‬ َ‫ْن‬‫ب‬‫ا‬ ‫م‬َ‫ي‬:ْ‫س‬َ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ َ‫ك‬ُ‫ت‬ْ‫ي‬َ‫ق‬ْ‫س‬َ‫ت‬ْ‫س‬‫ا‬َ‫ل‬‫م‬َ‫ق‬ ،‫ي‬ِ‫ن‬ِ‫ق‬:َ‫أ‬ َ‫ْف‬‫ي‬َ‫ك‬ ِِّ‫ب‬َ‫ر‬ ‫م‬َ‫ي‬َ‫يك‬ِ‫ق‬ْ‫س‬
َ‫ق‬ْ‫س‬َ‫ت‬ْ‫س‬‫ا‬ َ‫ل‬‫م‬َ‫ق‬ ‫؟‬َ‫ين‬ََِ‫ل‬‫م‬َ‫ع‬ْ‫ال‬ ُّ‫ب‬َ‫ر‬ َ‫ت‬ْ‫ن‬َ‫أ‬ َ‫و‬ْ‫س‬َ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ ٌ‫ن‬ َ‫َل‬ُ‫ف‬ ‫ي‬ِ‫د‬ْ‫ب‬َ‫ع‬ َ‫مك‬،ُِِ‫ق‬
ِ‫ل‬َ‫ذ‬ َ‫ت‬ْ‫د‬َ‫ج‬ َ‫و‬َ‫ل‬ َُُ‫ت‬ْ‫ي‬َ‫ق‬َ‫س‬ ْ‫و‬َ‫ل‬ َ‫ك‬َّ‫ن‬ِ‫إ‬ ‫م‬َََ‫أ‬‫ي‬ِ‫د‬ْ‫ن‬ِ‫ع‬ َ‫ك‬"
‫َسلم‬ ‫رواه‬
Hadith
• Prophet(S) said: On the day of judgement Allah
shall ask a person
• 1- I fell ill and you visited Me not…
• 2- I asked you for food and you did not feed me….
• 3-I asked you for water to drink and you did not
bring me the water…
• After each one, the person will say He will say: O
Lord, and how could you be (ill / hungry / thirsty)
for You are the Lord of the worlds?
• He will say: Did you not know that My servant
<So-and-so> was (ill / hungry / thirsty) and you
served him not?
• Did you not know that had you served him you
would have found Me with him? (MUSLIM)
Hadith
Making Zakat
More Effective
It doesn’t matter
how many
resources WE have..
ITS THEIR USE THAT
MATTERS
Effective
Zakat
Zakat Simplified Workshop 08-05-2019
Objective:
‘Serve Deen and
raise poor to
Sahib e Nisaab’
•The framework ... of
Zakat demonstrates
that it is intended to
be a systematic
institution rather
than simply a
personal act of
charity.
3 qualities of
effective
Zakat
(1) Pooling funds
• To make the initiative worthwhile
(2) Focusing locally
• Identifying needy people
• Linking local Zakat-givers
(3) Balancing distribution
• To different categories of people
The Axe Effect!
A man from the Ansar came to the Prophet, peace and
blessings be upon him, and begged from him. The
Prophet said, “Have you nothing in your house?”
The man said, “Yes, a piece of cloth, a part of which we
wear and a part of which we spread on the ground, and
a wooden bowl from which we drink water.”
The Prophet said, “Bring them to me.”
The man brought these articles to him and the Prophet
took them in his hands and he said, “Who will buy
these?”
Someone said, “I will buy them for one coin.”
The Prophet said twice or thrice, “Who will offer more
than one coin?”
Someone said, “I will buy them for two coins.”
He sold them for two coins and the Prophet said, “Buy
food with one of them and give it to your family. Buy
an axe and bring it to me.”
The man brought it to him. The Prophet fixed a handle
on it with his own hands and he said, “Go gather
firewood and sell it, and do not let me see you for a
fortnight.”
The man went away and gathered firewood and sold it.
When he had earned ten coins, he came and bought a
garment and food.
The Prophet said, “This is better for you than for
begging to come as a blemish on your face on the Day
of Resurrection. Begging is appropriate only for three
people: one in severe poverty, one in severe debt, and
one who must pay a difficult compensation.”
(Sunan Abu Dawud 1641)
Divide
Recipients
into 3
Categories
• Those who have no other means of
income and future possibility – ex.
disabled, old etc.)
A. Basic Support
• Where there is someone who can study
and develop skills
B. Educational Support
• Where there is a person in the family who
can start a venture – train and support
C. Entrepreneurship Support
Example - Zakat models in Bangladesh
Form Recipient Use for
Cattle Distribution Abject poor, Disabled, Widow,
aged
Seed Money
Rickshaw Distribution Capable Male Poor Seed Money
Sewing Machine Distribution Widow, Poor Female Seed Money
Clothes, Food stuff Distribution Abject poor, Disabled, Widow,
aged
Spent Money
Provide Tailoring Training Widow, Poor Female Seed Money
Money for doing business Poor Seed Money
Distribution of agricultural
material to farmers
Poor Seed Money
Scholarship to Students Poor students Seed Money
(indirectly)
Some Successful Models – Livelihood Store (SWC INDORE)
Zakat Simplified
Some Successful Models – Zariya Stall (SWC INDORE)
Zakat Simplified
Some Successful Models – Zariya Scheme (SWC INDORE)
Zakat Simplified
Possible Model for Effective Zakat
Set up a Zakat Circle in each locality / Masjid
Connect with Zakat payers in the locality
Identify Zakat needy persons (especially those who do not ask)
Categorise them into A, B and C categories
Support all three categories
Don’t limit Zakat to money – give your time, skills and knowledge
SSA’s ZAKAT HELPLINE 2019
• Answers to Queries on Zakaat
• Assistance in Valuation of Zakatable Assets
• Assistance in Calculation of Zakat Payable
• Till end of Ramadan 1440
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Zakat Simplified
Jazak Allah
Your comments and suggestions are welcome at
arahimcal@gmail.com
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CA ABDUL RAHIM
Zakat Simplified Workshop
www.saqti.org
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sirrisaqtiacademy@gmail.com

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Zakat Simplified 2019

  • 1. ZAKAT SIMPLIFIED CA Abdul Rahim Ramadan 1440 (May 2019) Kolkata, India
  • 2. Today’s agenda • Basics of Zakat • Zakatable Assets? • Valuation of Zakatable Assets • Case Study of Zakat Valuation • Zakat Payable by Whom? • How to pay Zakat • Who is Eligible to Receive Zakat? • The Spirit of Giving • Making Zakat More Effective Zakat Simplified Workshop
  • 4. The Wisdom of Zakat •Purity • In Wealth and Heart (Detachment) •Balances Inequity • In Society through Wealth Transfer •Brotherhood • Feeling of being part of one Ummah •Best investment • For Allah will give many times its reward Zakat Simplified Workshop
  • 5. Annual Income Annual Saving CONCEPTUAL CLARITY OF ZAKAT Minus: Expenses 08-05-2019 Zakat Simplified Workshop Every year we earn some income and incur some expense. What remains after that is our Annual Saving.
  • 6. Annual Savings of Various Years Total Wealth / Assets Zakat- able Assets CONCEPTUAL CLARITY OF ZAKAT Zakat Simplified Workshop Annual Savings of Various years are stored or Invested in various forms. These become our Wealth / Assets. Of these, only a few are ‘Zakatable’ i.e. Zakat is to be paid on them.
  • 7. Zakat- able Assets CONCEPTUAL CLARITY OF ZAKAT NISAAB CHECK IF… Zakat Simplified Workshop Calculate the value of your Zakatable Assets. If they Exceed the threshold (Nisaab), then only you are required to pay Zakat.
  • 8. Zakat- able Assets CONCEPTUAL CLARITY OF ZAKAT NISAAB CHECK IF… Zakat Simplified Workshop Zakat@ 2.5% of Zakatable Assets If Yes If your Zakatable Assets are more than the threshold (Nisaab), pay 2.5% of the Zakatable Assets as Zakat.
  • 9. Some Basics • Zakat = (Minimum) Obligatory Charity • Paid Annually (every lunar year, not solar year) • On few owned asset items (Zakatable Assets) • Valued as per market price (revalued every year) • Can be given to specified people only • Err on the side of safety Zakat Simplified Workshop
  • 11. Zakatable Assets – Only 6 Categories! Zakat Simplified Workshop Gold & Silver Cash & Equivalent Trade Stock Livestock Agriculture Produce Buried Treasure / Mines Since Livestock, Agriculture and Treasure / Mines are generally not found in cities, we limit this presentation to the first 3 items.
  • 12. Zakat on Gold & Silver
  • 13. Zakat on Gold & Silver • Payable on ALL Gold & Silver owned (in use, not in use, decorative etc.) • Rate will be as on date of Valuation, in city where asset is • In case trader in Gold & Silver, Zakatable but as ‘Trading Stock’ – no double zakat Zakat Simplified Workshop
  • 14. Calculating Zakat on Jewellery • Calculation based on weight • Exclude weight of diamonds, pearls, precious stones, platinum, Rubies etc. Zakat Simplified
  • 15. Valuation of Gold & Silver • Take Value of 24 carat Gold (per gram) • Value of 22 carat gold is 22/24 of 24 carat value • Value of 18 carat gold is 18/24 of 24 carat value • Ignore workmanship, design costs etc. • Silver take rate per Kg (as available in market) • Apply to all silver assets • Ignore other costs such as design etc. Zakat Simplified Workshop
  • 16. Gold and Silver Rates on 1 Ramadan 1440 AH in India (7 May 2019) Zakat Simplified Workshop Gold (24 Carat) per gram: Rs.3,180 Gold (22 Carat) per gram: Rs.2,915 Gold (18 Carat) per gram: Rs.2,385 Silver per Kg: Rs. 37,500
  • 17. Zakat on Cash & Equivalents
  • 18. Include all Cash and Bank Balances • Cash (even if separated for Haj etc) • Bank Balance – Current Account • Bank Balance – Savings Account • Exclude Interest • Bank Balance – Overdraft (Loan) Account • If balance positive, include • If negative (i.e. loan taken), minus as payable • Fixed Deposit / Recurring Deposit • Include principal (not interest) • Wallets (Paytm / JioMoney)Zakat Simplified Workshop
  • 19. Treatment of Debtors (Receivable) • All Debtors (Amounts due and Loans Given) are to be included as Zakatable Assets • Advance for Flat also (until flat transferred) • If amount is not recoverable • If sure of non recovery (written off), need not include • If recovered later, pay Zakat in the year of recovery. • If amount is doubtful of recovery • Zakat is payable every year, but can be deferred until amount is received.Zakat Simplified Workshop
  • 20. Treatment of Insurance / LIC / PF • Your amount kept with them is Zakatable • Employer’s contribution in PF is also your right, so to be included • Any INTEREST included / accumulated is NOT to be included • If any (halal) DIVIDEND is there, it should be added Zakat Simplified
  • 21. Treatment of Creditors (Payable) • Creditors to be deducted • Reduce all business creditors that remain, at end of year • Loans to be deducted • Loans for business / stock in trade to be deducted • Loan for Fixed Assets (such as home / factory / shop) • Better not to deduct - as such assets are not Zakatable Zakat Simplified Workshop
  • 23. What is Trade Stock • Covers ANY item kept for resale • Even a Flat if bought intending to sell it • Even a car if you are a car dealer • Covers shares, Mutual Funds etc. • Depends on initial Niyah when purchased Zakat Simplified Workshop
  • 24. Zakat on Trade Stock • Covers Raw material, Work in Progress Stock, Finished Goods, Trading stock • Tools of trade / machines not covered • Shops / offices / factories not covered • Damaged, Obsolete, Dead Stock • To be included if can be sold • Stock in Transit – to be included if FOB, not if CNF • My Stock in Other’s Godown - Include • Other’s Stock in my godown (ex. Agent) – Not to Include Zakat Simplified Workshop
  • 25. Valuation of Trade Stock for Zakat • Normal Goods • Value as per market rate • For Raw material, will be cost price • Can use bulk / wholesale rate • Damaged / Obsolete / Dead goods • At (discounted) market rate • May need to stop inventory transactions for some time to determine balance for Zakat Zakat Simplified Workshop
  • 26. Zakat on Shares and Debentures (Trade Stock) • Public Listed Shares • Value as per Market Rate (BSE / NSE) • Unlisted / Private Shares • If company managed by you, treat as separate unit and pay Zakat on it fully • If not your own company • Value from last available account • 2 options – take all assets or only Zakatable Assets Zakat Simplified Workshop
  • 28. Zakat on Sole Proprietorship • Since Sole Proprietorship / One Person Company (OPC) means only one person is the owner, identify all Zakatable assets of sole proprietorship and include in your own Zakat Calculation under appropriate heads. Zakat Simplified Workshop
  • 29. Zakat on Partnership Firm • Calculate value of Zakatable Assets (Gold, Silver, Cash equivalents and Stocks) held by partnership firm / LLP • Identify firm’s liabilities which are eligible to be deducted • Arrive at Zakatable Value • If all partners are Muslims • Pay 2.5% of this value as Zakat • If all partners are not Muslims • Calculate and pay proportionate share Zakat Simplified Workshop
  • 30. Zakat on Private Company • Calculate value of Zakatable Assets (Gold, Silver, Cash equivalents and Stocks) held by the Company • Identify company’s liabilities which are eligible to be deducted • Arrive at Zakatable Value • If all shareholders are Muslims • Pay 2.5% of this value as Zakat • If all shareholder are not Muslims • Calculate and pay proportionate share Zakat Simplified Workshop
  • 32. My factory - NOT ZAKATABLE Zakat Simplified Workshop
  • 34. My Home - NOT ZAKATABLE Zakat Simplified Workshop
  • 35. My Farms - NOT ZAKATABLE Zakat Simplified Workshop
  • 37. My home items above - NOT ZAKATABLE Zakat Simplified Workshop
  • 39. Conditions for Zakat • Muslim • Baligh (i.e. Adult) • Aaqil (i.e. of sound mind) • Owner & Possessor of the Property • Completion of one lunar year (called Haul) • Sahib-e- NIsaab Zakat Simplified Workshop
  • 40. Sahib-e-Nisaab • Gold – 87.48 grams (7.5 Tola) • Silver – 612.32 grams (52.5 Tola) • Cash or Trade Stock equivalent • Any combination of these Nisaab (7 May 2019, India) Based on Silver : Indian INR 22,900 approx Based on Gold (24 ct): INR 2,78,000 approx It is recommended to pay Zakat if you are eligible by the lower of these 2 thresholds (Nisaab) Zakat Simplified Workshop
  • 41. Sahib e Nisaab Zakat Simplified Workshop If Is More Than Rs. 22,900 Then Pay Zakaat @ 2.5% of TOTAL VALUE (not minus Nisaab)
  • 42. If your Zakatable assets are above Nisaab for full year, pay Zakat on Zakatable Assets at year end (red column – 12th month). Zakat Simplified Workshop Lunar Month 1 2 3 4 5 6 7 8 9 10 11 12 NetZakatable Assets Nisaab Zakat Payable on
  • 43. If your Zakatable assets are above Nisaab for full year, pay Zakat on Zakatable Assets at year end (red column – 12th month) even if there is an extra asset at end of year Zakat Simplified Workshop NetZakatable Assets Nisaab Zakat Payable on Lunar Month 1 2 3 4 5 6 7 8 9 10 11 12
  • 44. If your Zakatable assets are above Nisaab for full year, pay Zakat on Zakatable Assets at year end (red column – 12th month) even if it is lower than during the whole year. Zakat Simplified Workshop NetZakatable Assets Nisaab Zakat Payable on Lunar Month 1 2 3 4 5 6 7 8 9 10 11 12
  • 45. What to do with Interest? • Better not to deal with interest. • If, even then, have interest receipt: • Take it out from your bank account • Don’t use it for religious activities • Give it away for charitable activities (without expectation of reward) • Use it for activities like toilets construction, public cleaning etc. Zakat Simplified Workshop
  • 47. Hurry to pay Zakat • Once liability of Zakat is ascertained, it is the duty of the owner of the asset to pay Zakat immediately. • Someone else (like husband on behalf of wife) can pay, if asked / permitted by wife. • Better to encourage them to pay on their own • Not having liquid assets is NOT permissible excuse. Zakat Simplified
  • 48. Paying Zakat • Form • In Cash • By Cheque • Stock Items • Damaged / Obsolete Stocks? • An Asset • Means of Delivery • Directly to Beneficiary • Indirectly through Agency Zakat Simplified
  • 49. Who to Pay The person who is given Zakat Should be : • ELIGIBLE for Zakat • Made complete OWNER of amount • given GRATIS (i.e. Not for work done) • Given not only in Ramadan; round the year If Zakat is given in non-cash form (medicines / clothes / food), full ownership is must (ex. food packet instead of invitation to eat) Zakat Simplified Workshop
  • 50. Neeyah of Zakat Intention in Heart made If Segregated • At time of segregation If Direct Payment • At time of payment to recipient • After payment, until it is with recipient If Payment Through Agent • At time of payment to agent • After payment, until it is with agentZakat Simplified Workshop
  • 51. Who is Eligible to receive Zakat?
  • 52. Wealth / Assets Non- Essential Assets WHO IS ELIGIBLE TO RECEIVE ZAKAT? Zakata ble Assets Zakat Simplified Workshop To determine eligibility for Zakat, identify the Zakatable Assets and Non-Essential Assets that the person has in his total wealth.
  • 53. Non- Essential Assets WHO IS ELIGIBLE TO RECEIVE ZAKAT? Zakata ble Assets NISAAB How to Verify: Taharri Zakat Simplified Workshop If the value of Non-Essential Items and Zakatable Assets is less than Nisaab (threshold), then he is eligible to receive Zakaat. However, the way to assess this is by ‘Taharri’ i.e. based on our perception of his financial position, not by an inspection. It is better to have a soft / lenient approach toward this.
  • 54. Eligible recipients for Zakat 1. Faqeer: poor; one who has some money, but not sufficient for his basic needs 2. Miskeen: destitute; one who has nothing 3. Amileen: zakat collector, appointed by the Caliph 4. Mu'allafah Qulubuhum : to soften the hearts
  • 55. Eligible recipients for Zakat 5. Riqaab: to slaves to purchase their freedom 6. Gharim : one in debt for a legitimate reason 7. Fi Sabeelillah: in the path of Allah 8. Ibnis-Sabeel: wayfarer; one stranded away from home, with no money available to him
  • 56. Those who cannot be given Zakat • Non-Muslims • But we can and should give non- obligatory charity (Nafil Khairaat) to them • Employee or Labourer, as wages • Well-off people • Relations of birth – upward and downward • (i.e. mother, father, son, daughter, grandfather, grandson etc). Such people if needing support should be helped, but not from Zakat. • Other relations such as brother, sister, uncle, daughter-in-law, mother-in-law can and should be given Zakat as first priority. Zakat Simplified Workshop
  • 57. Those who cannot be given Zakat (Cont’d) • Relations of marriage • Husband and wife cannot give Zakat to each other but can give other (non- Zakat) amounts. • Children of the family of Bani Hashim • Prophet Muhammad (SAWS)’s family, Hazrat Ali (RA)’s family etc. • An organisation / institution (except as agent) • Even NGOs, hospitals etc. accept Zakat as agents Zakat Simplified Workshop
  • 58. Zakat Etiquette • Seek out the deserving • Give to (permitted) relatives first • Give with humility • Pay in secret, preferably • Need not explicitly mention it is Zakat • Don’t remind them of it 08-05-2019
  • 60. Don’t limit your Charity only to Zakat Let your hearts be detached from wealth Let giving be your way of investing with Allah Let us acknowledge that all we have is received from Allah and to be routed to his creation – through Us!
  • 61. ِ‫ق‬ْ‫ال‬ َ‫م‬ ْ‫و‬َ‫ي‬ ُ‫ل‬‫و‬ُ‫ق‬َ‫ي‬ َّ‫ل‬َ‫ج‬ َ‫و‬ َّ‫ز‬َ‫ع‬ َ َّ‫اَّلل‬ َّ‫ن‬ِ‫إ‬ََِِ‫م‬َ‫ي‬: َ‫ق‬ ‫ي‬ِ‫ن‬ْ‫د‬ُ‫ع‬َ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ ُ‫ْت‬‫ض‬ ِ‫ر‬ََ ،َ‫م‬َ‫د‬‫آ‬ َ‫ْن‬‫ب‬‫ا‬ ‫م‬َ‫ي‬َ‫ل‬‫م‬:َ‫ُك‬‫د‬‫و‬ُ‫ع‬َ‫أ‬ َ‫ْف‬‫ي‬َ‫ك‬ ِِّ‫ب‬َ‫ر‬ ‫م‬َ‫ي‬ َ‫ل‬‫م‬َ‫ق‬ ‫؟‬َ‫ين‬ََِ‫ل‬‫م‬َ‫ع‬ْ‫ال‬ ُّ‫ب‬َ‫ر‬ َ‫ت‬ْ‫ن‬َ‫أ‬ َ‫و‬:َِْ‫ل‬َ‫ع‬ ‫م‬َََ‫أ‬‫م‬ً‫ن‬ َ‫َل‬ُ‫ف‬ ‫ي‬ِ‫د‬ْ‫ب‬َ‫ع‬ َّ‫ن‬َ‫أ‬ َ‫ت‬ َ‫ك‬َّ‫ن‬َ‫أ‬ َ‫ت‬َِْ‫ل‬َ‫ع‬ ‫م‬َََ‫أ‬ ‫؟‬ُ‫ه‬ْ‫د‬ُ‫ع‬َ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ َ‫ض‬ ِ‫ر‬ََِ‫ع‬ ‫ي‬ِ‫ن‬َ‫ت‬ْ‫د‬َ‫ج‬ َ‫و‬َ‫ل‬ َُُ‫ت‬ْ‫د‬ُ‫ع‬ ْ‫و‬َ‫ل‬ُ‫ه‬َ‫د‬ْ‫ن‬. َ‫م‬َ‫د‬‫آ‬ َ‫ْن‬‫ب‬‫ا‬ ‫م‬َ‫ي‬:ِ‫ع‬ْ‫ط‬ُ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ َ‫ك‬ُ‫ت‬ََْ‫ع‬ْ‫ط‬َ‫ت‬ْ‫س‬‫ا‬َ‫ل‬‫م‬َ‫ق‬ ،‫ي‬ِ‫ن‬َْ:َ‫ْف‬‫ي‬َ‫ك‬ َ‫و‬ ِِّ‫ب‬َ‫ر‬ ‫م‬َ‫ي‬ َ‫ل‬‫م‬َ‫ق‬ ‫؟‬َ‫ين‬ََِ‫ل‬‫م‬َ‫ع‬ْ‫ال‬ ُّ‫ب‬َ‫ر‬ َ‫ت‬ْ‫ن‬َ‫أ‬ َ‫و‬ َ‫ك‬َُِ‫ع‬ْ‫ط‬ُ‫أ‬:ْ‫ط‬َ‫ت‬ْ‫س‬‫ا‬ َُُّ‫ن‬َ‫أ‬ َ‫ت‬َِْ‫ل‬َ‫ع‬ ‫م‬َََ‫أ‬َ‫ك‬َََ‫ع‬ َِْ‫ل‬َ‫ع‬ ‫م‬َََ‫أ‬ ‫ُ؟‬َُِْ‫ع‬ْ‫ط‬ُ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ ٌ‫ن‬ َ‫َل‬ُ‫ف‬ ‫ي‬ِ‫د‬ْ‫ب‬َ‫ع‬َ‫ل‬ َُُ‫ت‬ََْ‫ع‬ْ‫ط‬َ‫أ‬ ْ‫و‬َ‫ل‬ َ‫ك‬َّ‫ن‬َ‫أ‬ َ‫ت‬َ‫ت‬ْ‫د‬َ‫ج‬ َ‫و‬ ‫ي‬ِ‫د‬ْ‫ن‬ِ‫ع‬ َ‫ك‬ِ‫ل‬َ‫ذ‬. َ‫م‬َ‫د‬‫آ‬ َ‫ْن‬‫ب‬‫ا‬ ‫م‬َ‫ي‬:ْ‫س‬َ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ َ‫ك‬ُ‫ت‬ْ‫ي‬َ‫ق‬ْ‫س‬َ‫ت‬ْ‫س‬‫ا‬َ‫ل‬‫م‬َ‫ق‬ ،‫ي‬ِ‫ن‬ِ‫ق‬:َ‫أ‬ َ‫ْف‬‫ي‬َ‫ك‬ ِِّ‫ب‬َ‫ر‬ ‫م‬َ‫ي‬َ‫يك‬ِ‫ق‬ْ‫س‬ َ‫ق‬ْ‫س‬َ‫ت‬ْ‫س‬‫ا‬ َ‫ل‬‫م‬َ‫ق‬ ‫؟‬َ‫ين‬ََِ‫ل‬‫م‬َ‫ع‬ْ‫ال‬ ُّ‫ب‬َ‫ر‬ َ‫ت‬ْ‫ن‬َ‫أ‬ َ‫و‬ْ‫س‬َ‫ت‬ ْ‫م‬َ‫ل‬َ‫ف‬ ٌ‫ن‬ َ‫َل‬ُ‫ف‬ ‫ي‬ِ‫د‬ْ‫ب‬َ‫ع‬ َ‫مك‬،ُِِ‫ق‬ ِ‫ل‬َ‫ذ‬ َ‫ت‬ْ‫د‬َ‫ج‬ َ‫و‬َ‫ل‬ َُُ‫ت‬ْ‫ي‬َ‫ق‬َ‫س‬ ْ‫و‬َ‫ل‬ َ‫ك‬َّ‫ن‬ِ‫إ‬ ‫م‬َََ‫أ‬‫ي‬ِ‫د‬ْ‫ن‬ِ‫ع‬ َ‫ك‬" ‫َسلم‬ ‫رواه‬ Hadith
  • 62. • Prophet(S) said: On the day of judgement Allah shall ask a person • 1- I fell ill and you visited Me not… • 2- I asked you for food and you did not feed me…. • 3-I asked you for water to drink and you did not bring me the water… • After each one, the person will say He will say: O Lord, and how could you be (ill / hungry / thirsty) for You are the Lord of the worlds? • He will say: Did you not know that My servant <So-and-so> was (ill / hungry / thirsty) and you served him not? • Did you not know that had you served him you would have found Me with him? (MUSLIM) Hadith
  • 64. It doesn’t matter how many resources WE have.. ITS THEIR USE THAT MATTERS
  • 65. Effective Zakat Zakat Simplified Workshop 08-05-2019 Objective: ‘Serve Deen and raise poor to Sahib e Nisaab’
  • 66. •The framework ... of Zakat demonstrates that it is intended to be a systematic institution rather than simply a personal act of charity.
  • 67. 3 qualities of effective Zakat (1) Pooling funds • To make the initiative worthwhile (2) Focusing locally • Identifying needy people • Linking local Zakat-givers (3) Balancing distribution • To different categories of people
  • 68. The Axe Effect! A man from the Ansar came to the Prophet, peace and blessings be upon him, and begged from him. The Prophet said, “Have you nothing in your house?” The man said, “Yes, a piece of cloth, a part of which we wear and a part of which we spread on the ground, and a wooden bowl from which we drink water.” The Prophet said, “Bring them to me.” The man brought these articles to him and the Prophet took them in his hands and he said, “Who will buy these?” Someone said, “I will buy them for one coin.” The Prophet said twice or thrice, “Who will offer more than one coin?” Someone said, “I will buy them for two coins.” He sold them for two coins and the Prophet said, “Buy food with one of them and give it to your family. Buy an axe and bring it to me.” The man brought it to him. The Prophet fixed a handle on it with his own hands and he said, “Go gather firewood and sell it, and do not let me see you for a fortnight.” The man went away and gathered firewood and sold it. When he had earned ten coins, he came and bought a garment and food. The Prophet said, “This is better for you than for begging to come as a blemish on your face on the Day of Resurrection. Begging is appropriate only for three people: one in severe poverty, one in severe debt, and one who must pay a difficult compensation.” (Sunan Abu Dawud 1641)
  • 69. Divide Recipients into 3 Categories • Those who have no other means of income and future possibility – ex. disabled, old etc.) A. Basic Support • Where there is someone who can study and develop skills B. Educational Support • Where there is a person in the family who can start a venture – train and support C. Entrepreneurship Support
  • 70. Example - Zakat models in Bangladesh Form Recipient Use for Cattle Distribution Abject poor, Disabled, Widow, aged Seed Money Rickshaw Distribution Capable Male Poor Seed Money Sewing Machine Distribution Widow, Poor Female Seed Money Clothes, Food stuff Distribution Abject poor, Disabled, Widow, aged Spent Money Provide Tailoring Training Widow, Poor Female Seed Money Money for doing business Poor Seed Money Distribution of agricultural material to farmers Poor Seed Money Scholarship to Students Poor students Seed Money (indirectly)
  • 71. Some Successful Models – Livelihood Store (SWC INDORE) Zakat Simplified
  • 72. Some Successful Models – Zariya Stall (SWC INDORE) Zakat Simplified
  • 73. Some Successful Models – Zariya Scheme (SWC INDORE) Zakat Simplified
  • 74. Possible Model for Effective Zakat Set up a Zakat Circle in each locality / Masjid Connect with Zakat payers in the locality Identify Zakat needy persons (especially those who do not ask) Categorise them into A, B and C categories Support all three categories Don’t limit Zakat to money – give your time, skills and knowledge
  • 75. SSA’s ZAKAT HELPLINE 2019 • Answers to Queries on Zakaat • Assistance in Valuation of Zakatable Assets • Assistance in Calculation of Zakat Payable • Till end of Ramadan 1440 CALL / WHATSAPP SSA ZAKAT HELPLINE 9432671659 Zakat Simplified
  • 76. Jazak Allah Your comments and suggestions are welcome at [email protected] Or Whatsapp +91-8444057949 CA ABDUL RAHIM Zakat Simplified Workshop www.saqti.org fb.com/tssfindia [email protected]

Editor's Notes

  • #5: Imam Ghazali – Inner Dimensions of Zakaat: 1. Testing the degree of love for Allah (by separation from wealth which we live) 2. The elimination of miserliness and Greed 3. Expression of gratitude (for it is only from Allah that we received) Zakat is the one pillar that scholars have long identified as having the most obvious dual function of being an act of obedience to God and a means by which to affect positively the lives of human beings. As mentioned, Mulla Ali al-Qari (d. 1014 AH) describes Zakat as the “bridge to Islam.”
  • #37: - NOT ZAKATABLE
  • #41: Gold – 7.5 Tola – 87.48 grams (Price on 7 May 2019 = Rs.3,180 per gram – Kolkata) https://www.goodreturns.in/ Silver – 52.5 Tola – 612.32 grams (Price on 2 May 2018 = Rs.37,500 per kg)
  • #42: Rate on 6 June 2015 – 24 ct Gold 2707 / gram, Silver 39776 / kg
  • #55: Once liability of Zakat is ascertained, it is the duty of the owner of the asset to pay Zakat immediately. Someone else (like husband on behalf of wife) can pay on behalf is permitted. Non-liquid asset is NOT an excuse. These categories address the following objectives and highlight the problems that arise from ignoring spending in any of these areas: 1) 2) 3) 4) Al-Fuqara— poverty alleviation: the alternative is ongoing desperation, dislocation from the community, weakening of one’s faith, and the possibility of denial of God altogether. Al-Masakin— economic empowerment; the alternative is constant financial struggle and lack of communal resources since there would be fewer Zakat payers. Al-‘Amilina Alayha— efficient collection and effective Zakat administration of the other seven categories; the alternative is diminished collection and haphazard distribution. Al Mu’allafah Qulūbuhum— bringing hearts together through diplomacy, public relations, and social cohesion; the alternative is low social and political capital, animosity, and lack of influence.
  • #56: Once liability of Zakat is ascertained, it is the duty of the owner of the asset to pay Zakat immediately. Someone else (like husband on behalf of wife) can pay on behalf is permitted. Non-liquid asset is NOT an excuse. 5) Fir Riqab —emancipation, providing basic equality of rights and opportunity; the alternative is inequality and unfulfilled human potential. 6) 7) Al-Gharimīn— removing burdensome financial constraints that result from debt; the alternative is poor mental health for those in debt, tension between lenders and borrowers, discouragement of the practice of lending if there is no backup for lenders who face bad debts. Fī Sabīlillāh —supporting God’s cause and providing internal and external protection, by supporting those in the community who give of their time to represent and advocate on behalf of Islam and Muslims; and by supporting scholarship, so that scholars can guide people in a relevant way, and respond to the ideological and intellectual challenges of the day; the alternative is weakness in the face of external challenges, moral decline within the community, and low religious literacy. 8) Ibn al-Sabīl— for emergency situations, dealing with temporary dislocation; the alternative is social tension within and across communities if there is an inability to deal with stranded migrants or emergency scenarios.
  • #69: Anas ibn Malik reported: A man from the Ansar came to the Prophet, peace and blessings be upon him, and begged from him. The Prophet said, “Have you nothing in your house?” The man said, “Yes, a piece of cloth, a part of which we wear and a part of which we spread on the ground, and a wooden bowl from which we drink water.” The Prophet said, “Bring them to me.” The man brought these articles to him and the Prophet took them in his hands and he said, “Who will buy these?” Someone said, “I will buy them for one coin.” The Prophet said twice or thrice, “Who will offer more than one coin?” Someone said, “I will buy them for two coins.” He sold them for two coins and the Prophet said, “Buy food with one of them and give it to your family. Buy an axe and bring it to me.” The man brought it to him. The Prophet fixed a handle on it with his own hands and he said, “Go gather firewood and sell it, and do not let me see you for a fortnight.” The man went away and gathered firewood and sold it. When he had earned ten coins, he came and bought a garment and food. The Prophet said, “This is better for you than for begging to come as a blemish on your face on the Day of Resurrection. Begging is appropriate only for three people: one in severe poverty, one in severe debt, and one who must pay a difficult compensation.”