The purpose
of this booklet is to serve as an operational guide for the Muslims in
Issues like nisab
for kinds of wealth that were not identified by the Prophet (pbuh), the relative changes in the prices of
different kinds of commodities, the changes in the modes of production, the monetarization of business, i.e. its evaluation in monetary
units, the rise of other classes of rich people, such as high-rank employees
and professionals, who do not own much, though they live ostentatiously, and
the rise of financial and securities type of wealth are some of the issues that
need a new ijtihad.
The new
economic realities call for a general theory of zakah derived from the texts
of the Qur’an and the Sunnah
and based on them. Such a new general theory of zakah must, at the same
time, be sufficiently flexible to facilitate its application and to enable
Muslim scholars to cope with the changes in times to come.
Since the
time of the Prophet (pbuh), many
changes in the items used as store of value (= wealth) or as business assets
have taken place. Some changes even took place in the past and required new
rulings. This is clear in zakah from
the following examples:
Example One:
The Prophet (pbuh) said, “ I have
exempted you from zakah on your horses and
slaves.[1]”
Whereas, Omar, the second khalifah,
when told how expensive horses had become in
Example Two:
The Prophet (pbuh) made the nisab of the silver 200 “dirham” and gold
20 “dinar”. It is known that 200 dirham were equal to 20 dinar at his time.[3] None of these is, however, used as money in
today’s world. Is paper money exempted from zakah
as suggested by a few nineteenth-century Muslim scholars? If it is not exempted
on the ground that money, in any form, is a major item of wealth for
individuals, what is the nisab in terms
of our currencies today? Is it going to be based on the value of silver of
gold? Knowing that the weight
of 200 silver dirham is 595
grams (= 19.13 troy ounces), which is priced at US $ 101.20; and the weight of
20 golden dinar
is 85 grams (=2,733 troy ounces), which is priced at US$ 772.62 on January
4.2000[4]
This paradox compels us to look into the whole issue of nisab
and make certain generalizations based upon the sayings of the Prophet (pbuh).[5]
Professor al Qaradawi’s opinion, which seems to be
generally accepted by other contemporary Muslim scholars, is that we must take
the price of gold since it makes more consistency with the general principle
that zakah is a duty on the rich
and the poor is always either a recipient or at least exempt.
Furthermore,
We also have to bear in mind the changes in the circumstances of the
implementation of zakah. When it was imposed, at the time of the
Prophet (pbuh), there was an Islamic
government to take charge of the collection and distribution. Nowadays,
hundreds of millions of Muslims live in non-Muslim majority countries and they
do not have a formal institution that takes full charge of zakah
implementation with an authority similar to that of a government. Here again
there is a need for a new ijtihad to define the scope of authority of the
voluntary type of organizations that takes charge of the collection and
distribution of zakah.
II
METHODOLOGY
These
difficulties notwithstanding, the zakah has to be
implemented since it is the third pillar of Islam. Thus, a choice has to be
made based, partly on one’s understanding, analysis and approximation, i.e., on
ijtihad.
In the
calculation that follows, we draw heavily on al Qaradawi’s
two-volume encyclopedic treatise: Fiqh
al Zakah. There are three
areas where I felt that his reasoning, though very often marvelous, was not
suitable to the business environment, the form of assets and incomes, and the
mode of production and the high mobility and transformability of investments
prevailing in today’s industrial part of the world, especially the
1. He considers rented
real estate exempted from zakah while only the net-earned rent as zakatable [6],
whereas, we think that this is a business activity like any other business and
the total value of net equity in rental real estate is zakatable.
2. He drew an analogy
between industrial products and agriculture crops, and therefore, exempted from
zakah
all fixed assets of the industries and businesses. Thus According to al Qaradawi, the output alone is subject to zakah. It is to be calculated at 10% on gross output or 5% net output,
i.e., after deducting all expenses and allowances for depreciation of fixed
assets. He did not specify the conditions or circumstances under which a payer
must select either of these two methods of calculation, although we can easily
realize that there may be a huge difference in the due amount of zakah between the two methods.[7]
We think that all fixed assets used in business and industries carry more similarity
to the principal of ‘urud al tijarah
(=business inventory) and to the stock of cattle, sheep and camels because all
these assets are intended for investment to make growth and profits whether
through production, exchange or grazing and the shari’ah
did not intend to favor one form of business use of wealth over another.
Consequently zakah
must be paid on the net worth including fixed and variable assets.
3. On the Zakah on stocks, al Qaradawi
seems to agree with Abu Zahra, Khallaf and Hasan as to consider stocks as tradable objects that are
subject to zakah in analogy with ‘urud al tijatah (see Fiqh al Zakah),
yet in a recent fatwa, he seems to treat stocks like farming land
and exempt their principal investment from zakah,
leaving it to be imposed only on the dividends at a tare of 10%. We treat
stocks as ‘urud al tijarah.
This
booklet otherwise, fairly reflects al Qaradawi’s
magnificent work. The scope and the purpose of study doesn’t allow for full
presentation and substantiation of the view that serve as the basis for our
calculation because of the limitation of space and form of presentation.
Moreover,
this calculation takes into consideration the American reality in structure as
well as composition of wealth. Accordingly, certain kinds of wealth might have
been omitted from our listing because they do not exist in
Lastly, I
must point out that an earlier paper on the calculation of zakah
by Marghoob Ahmad Quraishi
is, undoubtedly, a valuable and courageous endeavor; and our calculation,
though adopts a different approach, yet takes consideration of Quraishi’s paper.
III
DEFINITIONS
1. Zakah:
the third pillar of Islam: a religious obligation; an amount due on the wealth
and income of a Muslim, as defined in shari’ah, to be
given to the poor and needy and other purposes as specified in shari’ah.
2. Zakah Payer:
The owner of a net worth income that is higher than a nisab.
3. Zakah Administrator:
The fund and agency that carries out the calculation and distribution of zakah.
4. Nisab:
The minimum amount that determines the zakatability of a person. He who owns nisab is a zakah payer. He
must pay zakah on all that he owns.
Thus, nisab is not exempted from zakah. Nisab
differs from one zakatable
item to another.
a. If all the wealth is in the form of
sheep and cattle, the nisab is equivalent to the
value of 40 sheep of average weight (including small and big all together).
This is equal to about $2000.00 in the current prices of the end of 1999.
However, the livestock holdings that are intended for business, either for sale
or for meat and milk production, are considered as business inventories
(=assets) and their nisab becomes in terms of
gold equivalent as in (c) below.
b. For agricultural products zakah is on the output. Nisab is the value of 635 kilos of wheat, corn, rye or similar basic
farm products in
c. For all other forms of wealth: nisab is the equivalent of 3 ounces of gold, i.e.,
approximately $1000.00 at January 4, 2000's prices[8].
This equals approximately ½ of the nisab on sheep.
d. In the afore-stated cases if the
holdings of one kind of wealth are below nisab,
then the different items must be added together, and nisab
will be considered as a weighted average on the basis of $1000.00 of cash
equivalent, i.e., you add ½ of the value of animals to others.[9]
Example
1: A person, who owns 20 sheep (½ nisab) and $400.00
in cash (less than ½ nisab) is not zakatable since he/she owns the equivalent of less than nisab of the total assets.
Example
2: A person owns 21 sheep, and $500.00 in cash; he/she is zakatable
because the total is more than nisab. He/she must
pay zakah
on $450.00.
5. Zakah Rate: The rate of zakah
is the percentage rate applied to the zakatable
material. It is 2.5% on cattle, sheep, similar animals, business net worth,
cash, etc. Whereas, it is one-tenth on agricultural produce, if the land is
watered by rain and rivers. If irrigation is done by men or mechanically, the
ratio is 5% only. For the treasures found underground, it is 20% of what is
found.
6. Zakatable Items: Any kind of wealth or income,
including agricultural products, not meant for personal or household-use. Zakah is
basically due on the net worth.
a. Examples of zakatable
items:
Cattle,
sheep, buffalo, poultry, etc.
Plants,
equipments, machinery, inventory etc., in net value after deducing debts on
them.
All agriculture products, honey, milk, eggs, silk,
etc.
Farms
machinery after deducing debts on them.
Cash
on hand, savings and checking accounts, saving certificates, etc.
Rented
estates and properties after deducing loans on them.
Men jewelry, excessive women jewelry, paintings and
decoration materials if they are in excess to what is normally used by other
Muslims of similar level of income and wealth.
Net salaries, profit, income of professionals, etc.
after deducing state and federal taxes, F.I.
Funds accumulated in an IRA account, or in any similar
personal or company-set retirement account, not the company’s matching amount,
nor the government-run social security.
b. Examples of non-zakatable items:
Owner
occupied homes if reasonable and not luxurious; also furniture, utensils, and
home appliances.
Women
jewelry within the customary level in the neighborhood (community) of the zakah payer.
Personal
and family clothes.
Agricultural
land farmed by the owner.
7. Zakah Year:
It is a full lunar year. It starts from the day the net worth reaches nisab. It must be noted, however, that zakah is due on certain items at the time of
acquisition, whereas, it is due on others on yearly basis, starting one year
after owning nisab. If it is difficult to
prepare a lunar balance sheet, one may use the solar calendar and use a zakah rate of 2.5776% instead of 2.5%. The rate of
agricultural products is not affected because their zakatability
does not depend on the passage of a year. However, al Qaradawi’s
opinion with regard to industrial output and stocks may require similar
adjustment in the applicable rate from 10% in a hijri
year to 10.3104% in a solar year.
8. Annuity of zakah:
zakah is yearly due. It must be paid every year on the
total net wealth and income. There are four cases where it is not paid on the
yearly basis: salary and professional incomes, agricultural output, business
profits, and treasures found. However, any portion of these items, if saved and
carried over the next year, is considered part of net wealth and is zakatable accordingly. The annuity of zakah implies that zakah
can’t be collected twice on the same zakatable item within one year.
IV TEST OF ZAKATABILITY
The purpose
of this test is to determine the zakatability
of a person. However, we should notice that zakah
is personal, i.e., every zakah payer must
calculate independently. A family owning zakatable
items may calculate jointly, if each member owns nisab
separately and what is below nisab of a person
is not added to what is owned by other family members.
Before you
fill in the schedule, take the following test:
Yes No
|
1. Do you own a business? |
-------- |
--------- |
|
2. Do you have cash, checking, savings
and money market accounts, stocks, bonds, options, certificates, commercial
papers, investment in futures, accounts with brokerage firms, etc., of a
total balance of a nisab
or more? |
--------- |
--------- |
|
3. Do you own any rented property? |
--------- |
--------- |
|
4. Do you own more than nisab of milk or meat producing livestock farms or a
poultry farm? |
--------- |
--------- |
|
5. Do you own valuable jewelries,
decorative and antique articles? |
--------- |
--------- |
|
6. Do you own more cars than the number
of drivers in the family? |
--------- |
--------- |
If
the answer to any of the questions 1 through 6 is yes, then answer the
following:
|
7. Are you under debt of more than you
own, excluding any mortgage on owned real estates and any long-term loans? |
--------- |
--------- |
If
your answer is no, then fill out the schedule.
|
8. Did you find any thing that is worth
a nisab
or more not knowing about its owner? |
--------- |
--------- |
If your
answer to question 9 is yes, you must fill out the zakah
schedule.
|
9. Is your annual net income more than
$7,500.00 multiplied by the number of persons in your household? |
--------- |
--------- |
If
your answer to question 9 is yes, then answer the following:
|
10.
Do you owe any amount to others payable within a year (including the mortgage
on the home you occupy but not on rented property) that absorbs all the
difference between your net income and $7,500.00 multiplied by the number of
the members of your household? |
--------- |
--------- |
If your
answer is no, you should fill in the schedule.
V
SHORT ZAKAT SCHEDULE[10]
1 2 3 4
Line No[11] Zakatable Items Amount Due Zakah
Part One: Yearly Items: all subject to
2.5% [12]
|
2-7 |
Cash on
hand and in banks |
-------- |
|
|
8-11 |
Shares,
stocks, futures, retirement accounts, etc. including their dividends and
returns |
-------- |
|
|
12-14 |
Gold,
silver, and their certificates |
------- |
|
|
15-16 |
Business
net worth |
------- |
|
|
17-19 |
Net real
estate (except house occupied by owner) |
------- |
|
|
20-28 |
Other
industrial and farming assets |
------- |
|
|
29-31 |
Zakatable
amount of women’s jewelry |
------- |
|
|
32-38 |
Livestock |
------- |
|
|
39-46 |
Net value
of extra transportation and extra other recreational
motors, boats, etc |
------- |
|
|
47 |
Total of zakatable
amount and due zakah |
------- |
|
|
|
Zakah ( = total amount in col. 3 X 0.025) |
______ |
--------- |
Part Two: Non-Yearly Items[13]
|
48-55 |
Rental income
net of expenses and taxes, salaries and professional income (take-home
income—family and similar expenses or $7500 multiplied by the number of
persons in the household) |
--------- |
|
|
56 |
Zakah (
= amount in col. 3 X 0.025) |
|
--------- |
|
57-62 |
Harvest
crops and other forming products not watered by man (net income after
expenses – household expenses)[14] |
--------- |
|
|
63 |
Zakah
( = amount in col. 3 X 0.10) |
|
--------- |
|
64-68 |
Harvest crops
and other farming products watered by man (net income after expenses –
household expenses)[15] |
--------- |
|
|
69 |
Zakah (
= amount in col. 3 X 0.05) |
|
--------- |
|
70-74 |
Mineral
products (gross output minus business and household expenses)[16] |
--------- |
|
|
75 |
Zakah (
= amount in col. 3 X 0.20) |
|
--------- |
|
76-78 |
Total Zakah
Due (add column 4)[17] |
|
_______ |
VI ZAKAH
SCHEDULE
Part I: yearly items
|
(1) Line No. |
(2) Items |
(3A) & Working
|
(3) Columns |
(4) Zakatable Amount |
(5) Rate |
(6) Zakat |
(7) Date Due |
||
|
1 |
Date you
acquired nisab
for the first time |
|
|
|
|
|
|
||
|
2 |
Cash on
hand |
|
|
............... |
|
|
|
||
|
3 |
Cash in
bank deposit box |
|
|
............... |
|
|
|
||
|
4 |
Cash in
saving accounts, time deposits and money market |
|
|
................ |
|
|
|
||
|
5 |
Cash in checking
accounts
|
|
|
................. |
|
|
|
||
|
6 |
Cash in
pass book accounts |
|
|
................. |
|
|
|
||
|
7 |
Saving
certificates |
|
|
................. |
|
|
|
||
|
8 |
Bonds,
securities |
|
|
................. |
|
|
|
||
|
9 |
Stocks,
shares in companies and in Mutual funds |
|
|
................. |
|
|
|
||
|
10 |
Options |
|
|
................. |
|
|
|
||
|
11 |
Commercial
papers |
|
|
................. |
|
|
|
||
|
12 |
Investments
in futures and any other brokerage accounts |
|
|
………… |
|
|
|
||
|
13 |
Investments
in retirement accounts: IRA KEO 401K Other Retirement Accounts |
….. ….. ….. |
|
…………. |
|
|
|
|
(1) Line No. |
(2) Item
|
(3A) (3) Working
Columns |
(4) Zakatable Amount |
(5) Rate |
(6) Zakah |
(7) Date Due |
|
|||
|
14 |
Surrender
amount of life insurance |
|
|
………… |
|
|
|
||||
|
15 |
Gold &
gold accounts & gold Certificates |
|
|
................. |
|
|
|
||||
|
16 |
Silver
& silver certificates |
|
|
................. |
|
|
|
||||
|
17 |
Men’s
golden jewelry |
|
|
................. |
|
|
|
||||
|
18 |
Private
business net worth |
|
|
................. |
|
|
|
||||
|
19 |
Share in a
partnership’s net worth |
|
|
................. |
|
|
|
||||
|
20 |
Real estate
(not including houses occupied by owner and family members free of rent and
farm land Farmed by owner) |
|
|
|
|
|
|
||||
|
21 |
Mortgage
and loans against line 20 |
|
---- |
|
|
|
|
||||
|
22 |
Deduct 21
from 20 and write in Column 4 |
|
|
................. |
|
|
|
||||
|
23 |
Net worth
of industrial business |
|
|
............... |
|
|
|
||||
|
24 |
Farming
machines, equipments, shades,
barns, and buildings |
|
..... |
|
|
|
|
|
|||
|
25 |
Mortgage
and loans against line 24 |
|
---- |
|
|
|
|
|
|||
|
26 |
Deduct 25
from 24 and put it in column 4 |
|
|
................ |
|
|
|
|
|||
|
(1) Line No |
(2) Item |
(3A) (3) Working
Columns |
(4) Zakatable Amt. |
(5) Ratio |
(6) Zakah |
(7) Date Due |
|
27 |
Extravagant
excess in personal residence |
|
..... |
|
|
|
|
|
28 |
Shares of
the amount of line 27 in total home mortgage |
|
---- |
|
|
|
|
|
29 |
Shares of
the amount of line 247in total home mortgage |
|
|
................ |
|
|
|
|
30 |
Gold and
silver utensils |
|
|
................ |
|
|
|
|
31 |
Other
valuable objects and extravagant nature. |
|
|
................ |
|
|
|
|
32 |
Women’s
jewelry |
|
..... |
|
|
|
|
|
33 |
10% of the
household’s yearly income multiplied by the number of women wearing jewelry
in the family |
|
---- |
|
|
|
|
|
34 |
Deduct line
33 from line 32 |
|
|
................ |
|
|
|
|
35 |
Milk &
meat cattle |
|
|
................ |
|
|
|
|
36 |
Milk &
meat sheep |
|
|
................. |
|
|
|
|
37 |
Milk &
meat camels |
|
|
................. |
|
|
|
|
38 |
Poultry
(egg & meat, etc.) |
|
|
|
|
|
|
|
39 |
Other
marketable animals (horses, etc.) |
|
..... |
|
|
|
|
|
(1) Line No |
(2) Items |
(3A) (3) Working
Columns |
(4) Zakatable Amount |
(5) Rate |
(6) Zakah |
(7) Date Due |
|
40 |
Riding
animals of the household members |
|
---- |
|
|
|
|
||
|
41 |
Deduct 40
from 39 and put in column 4 (if less than zero, write zero) |
|
|
................ |
|
|
|
||
|
42 |
Cars, trucks
(excluding household transportation cars) |
|
..... |
|
|
|
|
||
|
43 |
Loans against line
42
|
|
..... |
|
|
|
|
||
|
44 |
Deduct
43 from 42 and put in Column 4 |
|
|
............... |
|
|
|
||
|
45 |
Trailers,
boats, ships, etc. |
|
..... |
|
|
|
|
||
|
46 |
Loans
against 45 |
|
..... |
|
|
|
|
||
|
47 |
Deduct 46
from 45 and put in Column 4 |
|
|
------------ |
|
|
|
||
|
48 |
Total of
Part One |
|
|
............... |
|
|
|
||
|
49 |
Loans not
included above (excluding mortgage on home) |
|
|
------------ |
|
|
|
||
|
50 |
Deduct 49
from 48: NET ZAKATABLE AMOUNT, multiply
by rate to get: amount
OF ZAKAH due and write in column (6) |
|
|
................ |
0.025 |
........... |
|
Part II: None-Yearly Items
|
(1) Line No |
(2) Items |
(3A) (3) Working
Columns |
(4) Zakatable Amount |
(5) Rate |
(6) Zakah |
(7) Date Due |
|||
|
|
Section A: Salaries & professional
Income |
|
|
|
|
|
|
||
|
51 |
Yearly Net
Income (in column 3) |
|
..... |
|
|
|
|
||
|
52 |
Family
deductions (in column 3A) |
..... |
|
|
|
|
|
||
|
53 |
Help to
parents, grandparents, etc. |
..... |
|
|
|
|
|
||
|
54 |
Help &
donations to others |
..... |
|
|
|
|
|
||
|
55 |
Other necessary
expenses
|
---- |
|
|
|
|
|
||
|
56 |
Add 52 to
55 and write in column 3 |
|
….. |
|
|
|
|
||
|
57 |
Deduct 56
from 51 and put in Column 4,
multiply by rate to get zakah |
|
….. |
................ |
0.025 |
.......... |
By end Of year |
||
|
58 |
Zakah paid during the year (write in column 6) |
|
|
|
|
…….. |
|
||
|
59 |
Balance due
at the end year (Deduct 55 from 54) |
|
|
|
|
........... |
|
||
|
|
Section B: Agricultural products, honey, Sea-products, etc. --not watered by
man. |
|
|
|
|
|
|
||
|
60 |
Value of
gross crops on harvest day: (Put in Column 3) |
|
… |
|
|
|
|
||
|
60a |
Wheat, barley, and
other cereal
|
|
..... |
|
|
|
|
||
|
60b |
Rice,
soybean |
|
..... |
|
|
|
|
||
|
(1) Line No. |
(2) Item |
(3A) (3) Working Columns |
(4) Zakatable Amount |
(5) Ratio |
(6) Zakah |
(7) Date Due |
|
60c |
Vegetables |
|
..... |
|
|
|
|
|
60d |
Fruits |
|
..... |
|
|
|
|
|
60e |
Cotton |
|
.... |
|
|
|
|
|
60f |
Rubber |
|
..... |
|
|
|
|
|
60g |
Tobacco |
|
..... |
|
|
|
|
|
60h |
Hays and
other cattle feed |
|
..... |
|
|
|
|
|
60i |
Lumber |
|
..... |
|
|
|
|
|
60j |
Honey |
|
..... |
|
|
|
|
|
60k |
Other
agricultural crops |
|
..... |
|
|
|
|
|
61 |
Sea products:- |
|
|
|
|
|
|
|
61a |
Fish |
|
..... |
|
|
|
|
|
61b |
Earl |
|
.... |
|
|
|
|
|
61c |
Other
sea-products |
|
---- |
|
|
|
|
|
62 |
Add 60 and
61 and put in Col. 3 |
|
..... |
|
|
|
|
|
63 |
Cost on
products of 60 and 61 (Write in
3A) |
|
|
|
|
|
|
|
63a |
Wages |
..... |
|
|
|
|
|
|
63b |
Rent (for
rented land, equipment, etc.) |
..... |
|
|
|
|
|
|
63c |
Maintenance |
..... |
|
|
|
|
|
|
63d |
Gas and electricity
|
..... |
|
|
|
|
|
|
(1) Line No |
(2) Item |
(3A) (3) Working Columns |
(4) Zakatable Amt. |
(5) Ratio |
(6) Zakah
|
(7) Date Due |
|
63e |
Feed |
..... |
|
|
|
|
|
||
|
63f |
Insurance |
…,. |
|
|
|
|
|
||
|
63g |
Veterinary |
..... |
|
|
|
|
|
||
|
63h |
Freight and
transportation |
..... |
|
|
|
|
|
||
|
63i |
Seed |
..... |
|
|
|
|
|
||
|
63j |
Fertilizers |
..... |
|
|
|
|
|
||
|
63k |
Pesticides |
.... |
|
|
|
|
|
||
|
63l |
Other farm
expenses |
..... |
|
|
|
|
|
||
|
64 |
Household
expenses, if not already claimed (write in 3A) |
|
|
|
|
|
|
||
|
64a |
Family
deductions |
..... |
|
|
|
|
|
||
|
64b |
Help to
parents |
..... |
|
|
|
|
|
||
|
64c |
Help to
others |
..... |
|
|
|
|
|
||
|
64d |
Other
necessary expenses |
---- |
|
|
|
|
|
||
|
65 |
Add 63 and
64 and write in Column 3 |
|
---- |
|
|
|
|
||
|
|
Deduct 65
from 62 and put in column 4, multiply by rate to get zakah |
|
|
................ |
0.10 |
........... |
|
|
(1) Line No |
(2) Item |
(3A) (3) Working Columns |
(4) Zakatable Amount |
(5) Rate |
(6) Zakah |
(7) Date Due |
|
|
Section C: Crops watered by man |
|
|
|
|
|
|
|
67 |
Value of gross
crop on harvest day (Write in column 3) |
|
…. |
|
|
|
|
|
67a |
Wheat,
barley, and other cereal |
|
..... |
|
|
|
|
|
67b |
Rice,
soybean |
|
..... |
|
|
|
|
|
67c |
Vegetables |
|
.... |
|
|
|
|
|
67d |
Fruits |
|
..... |
|
|
|
|
|
67e |
Cotton |
|
..... |
|
|
|
|
|
67f |
Rubber |
|
..... |
|
|
|
|
|
67g |
Tobacco |
|
..... |
|
|
|
|
|
67h |
Hays and
other cattle-feed |
|
..... |
|
|
|
|
|
67i |
Lumber |
|
..... |
|
|
|
|
|
67j |
Other
agricultural products |
|
---- |
|
|
|
|
|
68 |
Add all 67a –
j together
|
|
..... |
|
|
|
|
|
69 |
Cost on
products of 67, write in 3A |
|
|
|
|
|
|
|
69a |
Wages |
.... |
|
|
|
|
|
|
69b |
Rent (for
rented land, equipment, etc.) |
..... |
|
|
|
|
|
|
69c |
Maintenance |
..... |
|
|
|
|
|
|
69d |
Gas and
electricity |
….. |
|
|
|
|
|
|
(1) Line No |
(2) Item |
(3A) (3) Working Columns |
(4) Zakatable Amount |
(5) Rate |
(6) Zakah |
(7) Date Due |
|||
|
69e |
Feed |
..... |
|
|
|
|
|
||
|
69f |
Insurance |
..... |
|
|
|
|
|
||
|
69g |
Veterinary |
..... |
|
|
|
|
|
||
|
69h |
Transportation
and Freight |
..... |
|
|
|
|
|
||
|
69i |
Seed |
..... |
|
|
|
|
|
||
|
69j |
Fertilizers |
..... |
|
|
|
|
|
||
|
69k |
Pesticides |
..... |
|
|
|
|
|
||
|
69l |
Other farm expenses
|
..... |
|
|
|
|
|
||
|
70 |
Household
expenses (write in column 3A) |
|
|
|
|
|
|
||
|
70a |
Family
deductions |
..... |
|
|
|
|
|
||
|
70b |
Help to
parents |
..... |
|
|
|
|
|
||
|
70c |
Help to
others |
..... |
|
|
|
|
|
||
|
70d |
Other
necessary expenses |
---- |
|
|
|
|
|
||
|
71 |
Add 66 and
67 and write in Column 3 |
|
---- |
|
|
|
|
||
|
|
Subtract 68
from 65 and put in Column 4, multiply by rate to get Zakah |
|
|
................ |
0.05 |
........... |
|
||
|
(1) Line No. |
(2) Item |
(3A) (3) Working Columns |
(4) Zakatable Amt. |
(5) Rate |
(6) Zakah
|
(7) Date Due |
|
|
Section D: Minerals and found treasures |
|
|
|
|
|
|
|
73 |
Value of
gross output (write in column 3) |
|
|
|
|
|
|
|
73a |
Gravel |
|
..... |
|
|
|
|
|
73b |
Salt |
|
..... |
|
|
|
|
|
73c |
Iron ore |
|
..... |
|
|
|
|
|
73d |
Coal |
|
..... |
|
|
|
|
|
73e |
Oil |
|
..... |
|
|
|
|
|
73f |
Other Ores |
|
..... |
|
|
|
|
|
73g |
Found and unclaimed
treasure
|
|
….. |
|
|
|
|
|
74 |
Add 73a
through 73g |
|
|
|
|
|
|
|
75 |
Cost of
products of 73 (Write in column 3A) |
|
|
|
|
|
|
|
75a |
Wages |
..... |
|
|
|
|
|
|
75b |
Rent (for
rented land, equipment, etc.) |
..... |
|
|
|
|
|
|
75c |
Maintenance |
..... |
|
|
|
|
|
|
75d |
Gas and
electricity |
..... |
|
|
|
|
|
|
75e |
Office
supplies |
..... |
|
|
|
|
|
|
75f |
Insurance |
..... |
|
|
|
|
|
|
75g |
Freight and
transportation |
..... |
|
|
|
|
|
|
(1) Line No. |
(2) Item |
(3A) (3) Working
Columns |
(4) Zakatable Amount |
(5) Rate |
(6) Zakah
|
(7) Date Due |
|
75h |
Depreciation
of franchise, plants, and equipment |
..... |
|
|
|
|
|
||
|
75i |
Other
expenses |
..... |
|
|
|
|
|
||
|
76 |
Household
expenses (Write in column 3A) |
|
|
|
|
|
|
||
|
76a |
Family
deductions |
..... |
|
|
|
|
|
||
|
76b |
Help to
parents |
..... |
|
|
|
|
|
||
|
76c |
Help to
others |
..... |
|
|
|
|
|
||
|
76d |
Other
necessary expenses |
..... |
|
|
|
|
|
||
|
77 |
Add 75 and
76 and write in Column 3 |
|
….. |
|
|
|
|
||
|
78 |
Deduct 77 from
74 and put in col. 4, multiply by rate to get zakah |
|
|
................ |
0.20 |
........... |
|
||
|
79 |
Total zakah to be
paid: Add col. 6, lines 50, 59, 66, 72, and 78 |
|
|
|
|
........... |
|
||
|
80 |
Zakah previously paid (if not included in 58) |
|
|
|
|
------- |
|
||
|
|
Deduct 80
from 79 NET PAYABLE
ZAKAH
|
|
|
|
|
-------- |
|
VII
INSTRUCTIONS
Instructions
hereinafter correspond with the line-numbers in the zakah schedule. The zakah schedule is divided into two major
parts:
Part I for
yearly items, and
Part II for
non-yearly items.
Part two is
further divided into four sections:
Section A: For Salaries and professional incomes.
Section
B: For agricultural products,
forestry and fishing, watered by rain, rivers, canals, etc.
Section
C: For agricultural products and
forestry watered by applying power and energy.
Section D: For minerals and treasures found.
** *** **
1
Write in the box on line 1, the date
you first acquired nisab.
For the meaning and method of nisab’s
calculation, see definition 4. Remember if it is difficult to use the hijri calendar, you may use the solar
calendar provided you multiply each rate of zakah
by the quantum (1 + 365-354/354), this makes the 2.5% a 2.5776%, other rates
should have corresponding increments.
2-7 For each of these
lines, write in column (4) the balance of each item on the same day and month,
but one year after the year in the box in the box on line 1.
8-10
These items are valued at the established market prices on the day when zakah is due. The market price is considered
established, if it is not expected to drop below its current level. Otherwise,
the established market price is the highest price below which the market price
is not expected to drop. This is to be written in column (4).
11
Valued at face. Since any difference is interest, a commercial paper
has only one value regardless of its
due date. Write in column (4).
12
Valued at the established market price, and if it is not available, at
the market price.
13 Valued at the established market price and if not, at the market
price as you receive it from statement of each of these accounts. Do not
include the employer’s matching funds and their share of capital appreciation,
and reinvested capital gains and dividends, unless a number of years passed
that you become the legal owner of the matching funds should you leave the
company. Do not deduct any potential penalty, though you deduct actually paid
penalties on amount withdrawn (such paid penalties are an item of your cost
deducted at source at time of withdrawal, and they did not enter into your
liquid asset anyway likes deducted income taxes and FICA).
14
This is the amount you actually own on the day of calculating your zakah.
15-16 Valued at the established market prices.
See instruction 8 and write in column (4).
17 Valued at established market price, if this
is not available, then at cost.
18
Business net worth as shown in a balance sheet duly drawn to reflect the
Zakatability at the end of the zakah year. This net-worth is the difference
between business assets (cash, bank accounts, and inventory valued at market
purchases prices at the end of the zakah
year regardless of its cost, accounts receivable minus reasonable provision for
doubtful debts, other current assets at the market purchase value, fixed assets
at cost minus depreciation, calculated at the acceptable accounting and
auditing sound standards that are not meant to minimize taxes) and business
liabilities (accounts payable minus provision for expected discount, loans,
bonds issued at face value, and other liabilities): write the net worth in
column (4).
19
For calculating net worth, see instruction 18.
20
Real estates is valued at established market prices at the end of the zakah
year. Write in column (3). Line 20 includes the value of land designated for
construction, buildings, whether rented or not, used by owner or not. Farming
land cultivated by the owner is excluded. Home occupied by the owner is also
not included (see line 27). Buildings given to others (friend or family) to use
free of charge is not zakatable
by owner. Farming land leased on crop sharing is also excluded (see line, 60).
21
This is written at the face
value, principal only, do not include any interest. Write in column (3).
22
Line 22 is the zakatable amount. Write in
column (4).
23
See instruction 18.
24
Valued at the established market price. If market price is not
available, then it should be valued at the initial cost minus fair and
reasonable depreciation.
25
At face value of loans and mortgages (not including interest if any).
27
This is excess in the value of zakah payer’s residence
(including building, land, surrounding facilities such as garage, furniture,
home equipment and utensils). Such excess is beyond reasonable living
facilities. Any doubt on the payment of zakah must be
interpreted by the zakah
administrator to the benefit of the zakah payer while the zakah payer must be keen to
consider any doubt that he might have to the benefit of the zakah recipients. For
example, a family of four with a yearly income of $45,000 to 60,000 may have a
residence in
28
Write here the total face value of mortgage and loans on the residence,
multiplied by the ratio of the amount on line 27 to the established market
value of the residence. Write in column (3).
30 Valued at the established marked
prices. Write in column (4).
31 Valued at established market prices.
Include in this line, diamonds and precious stones if omitted on line 32. Write
in column (4).
32
Women’s jewelry is valued at established market prices. If such prices
are not available, then at cost. Since each zakah payer must calculate
for his/her zakah
independently, line 29 may not be applicable to many male zakah payers. Write in column
(3).
33 The estimation of the extravagance
limit is always opinionated. My own judgment is that a one time 10% of annual
income is a maximum for the non-luxury jewelry in
34 Write in column (4).
35-38
Write in column (4) the established market value of these items.
39
Valued at established market prices. Do not include value of honeybees.
42
Cars and trucks are valued at established market prices and if the same
is not available, then at purchases value minus fair depreciation. Do not
include car or cars used for family transportation. If the family owns more
than one car and the additional cars are used for luxury, not for normal
transportation, then luxury cars must be included. Write in column (3).
45 Valued at
established market prices, it the market price is not available, then at purchase
price minus fair depreciation. If a trailer is used as a residence of the zakah payer or is lent free to others for use, it must
not be included on line 42. (See instruction 17 above).
48 In column (4), add
lines 1 through 19, 22, 23, 26, 29, 31, 34, 35, 36, 37, 38, 41, 44, and 47.
Write the total in line 45 in column (4).
49
Write on this line, the principal of all loans and mortgages not
included above. Do not write the mortgage on your residence or on a residence,
or real estate that is given to others for free use i.e. any real estate that
is not zakatable–
its loan is not deductible.
50
Multiply line 47, column (4) by 0.025 and write in column (6). This is the amount
due as zakah on part one. Write in box in column (7), the
same month and day but on lunar year later as in the box on line 1, column (7).
This is the due date for this part
of zakah.
51
Write yearly income after paying federal and state taxes, F.I.C.A.,
trade union fees, credit union installment, etc. Write in column (3).
52(a) if
your net income is below $40,000 annually, write in column (3A), the following:
The lesser of
$30,000.00 or actual expenses, if single.
The lesser of
$34,000.00 or actual expenses, if married.
The lesser of
$35,000.00 or actual expenses, if married with one child.
The lesser of
$37,000.00 or actual expenses, if married with 2 children.
The lesser of
$38,000.00 or actual expenses, if married with 3 children.
The lesser of
$38,000.00 or actual expenses, if married and with 4 ch.
& up
(b) If your net income is 40,000 – 89,999 annually, write in column (3A),
the following:
The lesser of
$35,000.00 or actual expenses, if single.
The lesser of
$41,000.00 or actual expenses, if married.
The lesser of
$42,000.00 or actual expenses, if married with 1 child.
The lesser of
$42,000.00 or actual expenses, if married with 2 children.
The lesser of
$42,000.00 or actual expenses, if married with 3 children.
The lesser of
$43,000.00 or actual expenses, if married with 4 ch.
& up.
(c) If
your annual net income is $90,000 or above, write in column (3A) the following:
The lesser of
$65,000.00 or actual expenses if single.
The lesser of
$70,000.00 or actual expenses if married.
The lesser of
$73,000.00 or actual expenses in married with 1 child.
The lesser of
$73,000.00 or actual expenses if married with 2 children.
The lesser of
$76,000.00 or actual expenses if married with 3 children.
The lesser of
$78,000.00 or actual expenses if married with 4 ch.
& up.
(Figures in 49(a), (b) and (c) are adapted and rounded from average
consumer expenditure in the
However, if actual spending is
more than the figures given above without any reason accepted in shari’ah, then what is above the amounts
quoted is zakatable
even though it was actually spent. (See No 53-55)
53
Write in (3A), the amount of help paid to the parents and other members
of the family who must not be recipient of your own zakah.
54
Write in (3A), grants, gifts, and donations given to other individuals,
Islamic organizations, and charitable institutions, etc.
55
Write in (3A), all other final and necessary expenses if not included in
52, such as hospitable, medical, tuition, funeral, moving expenses, installment
of loans for previous expenses, etc.
57
The amount in column (4) is the zakatable amount. Multiply by
0.025 and write in column (6). This is the computed zakah. It is due the day
income is received, which is generally dispersed through out the
year. The zakah payer must make certain
estimations and start paying during the year.
58
This line includes all the payments made during the year with the
intention of zakah. Some of these may be included in line
54.
59
The balance is written in column (6). It is due at the end of the income
year. It is recommended, however, to unify the due date with part one, line 50.
60
This line is for agricultural products watered by rain, canals and/ or other
permanent fixed installations. For water carried, see 67. On lines 60a to 60j,
write in column (3) all kinds of agricultural products valued at the market
prices on the day of harvest provided they or their providing sources have not
been included before. For example, since silkworms, honey bees, lands and trees
are not included elsewhere, their product should appear on lines, 60a-60j.
61
Write in column (3), all kinds of sea products provided the fisherman,
his family and friends, does not use them for immediate consumption free of
cost. Only commercial fishing or pearl products, etc., are included at the
market prices on the day of acquisition.
62
Write in column (3A), all costs of production of 60 and 61 whether paid
actually or not, as long as they are due. Do not add anything as rent for the
owned-farming land or fishing vessels nor any depreciation for barns, shades
and any other farming building (see instruction 24 and 45 above). Do not add
salary for yourself or any family member living with you as a part of the
household if such a salary is not actually paid or credited to him / her.
63
Write in column (3A), family deductions. See instruction 52 to 55
provided that they are not on lines 52 to 55, i.e. do not make deduction twice
for any deductible item.
66
Deduct 65 from 62 and write balance in column (4) if more than zero,
otherwise, write zero. The rate in column (5) is 10%. Multiply the amount in
column (4) by 0.10 and write in column (6). This is the amount of zakah. The due date is
the harvest day; if it is a continuous activity through out the
year, then the latest due date would be the end of the lunar year. It is
recommended in such a case to unify your due date with part one, line 50.
67If animals or trucks bring the water, then use line 67 to 71.
69-71 See instruction 63, 64 and 65 above.
72
The balance in column (4) must be multiplied by 0.05; put the result in
column (6). This
is the amount of zakah. The due date is the harvest day. (See instruction 66).
73
Write in column (3), all output of self-owned mineral extraction
business valued on the day of extraction.
75
See instruction 63.
76
See instruction 64.
78
The balance in column (4) is the zakatable amount. Multiply by
0.20. The
result is the zakah. Write it in column (6). The due date is the extraction day; if it is a
continuous production, the latest day is the end of the lunar year. It is
recommended, in this case, to unify one’s zakah year for all items.
79
Add all amounts in column (6).
81 Net Zakah
payable.