Copy of Zakat Full Notes
Copy of Zakat Full Notes
DEFINITION OF ZAKAT
• Defined as: Growth, Increase & Purification, Blessings
• MASB Tri-1: zakat is an obligatory contribution assessed based on certain assets
owned by a Muslim that satisfy certain conditions and distributed to specified
categories of beneficiaries.
CONCEPT OF ZAKAT SPIRITUALLY
1. Increase or growth
- Will not lead to become poorer, but enhance prosperity in the world and achieve
success in hereafter
2. Purify
- Paying zakat will purify the soul and wealth of Muslims, from feelings of jealousy,
greed and materialism of the rich
ROLE OF ISLAMIC STATE AND THE ZAKAT INSTITUTION
• Primary role: to administer both zakat collection and distribution
• Other roles of the Islamic State and Institution of Zakat
- Ensuring payment of zakat fulfilled the conditions of zakat & conduct enforcement
- Identify asnaf that eligible to receive zakat
- Implement proper accounting and auditing that could help managing zakat efficiently
- Conduct activities to create awareness of zakat accountability
- Develop programme to help asnaf (business class)
• 4 different forms of zakat corporations
- Corporation under zakat enactment : Lembaga Zakat Negeri Kedah
- Corporation under State of Administration of Islamic Law Enactment :
PPZMAIWP
- Corporation under State of Adnimistration of other Law Enactment : Lembaga
Zakat Selangor
- State Islamic Religious Council: collection and distribution of zakat through its
unit or baitulmal or zakat centres
2. Social perspectives
- Creates brotherhood between rich and poor people
- Unites the society based on true believers
FAR658 Notes | Nursyazwani Izaty, 2024
- Eliminates the common disease of society which ranks the social classes based on
wealth
2. Alert with proper time of zakat payment – favourable times Muharram, Ramadan
3. Do good deeds in secret – remove hypocritical displays and reputation-seeking and
preserves dignity of zakat recipients
4. Give openly – to serve reminder for others to give zakat
5. Avoid taunting and hurting – show humbleness and not pride
6. Adopt humility – think little of their donation
LEGAL MAXIMS OF ZAKAT
1. No duplication in zakat collection – should be paid only once for specific wealth
2. Should not burden the payer and should not deprive the rights of the poor
3. Zakat is paid where the wealth is generated or located – geographical area of
the collection
4. Zakat does not purify unlawful income – wealth earned by non-permissible
income cannot be cleansed through zakat payment
5. Prepayment of zakat is allowable – esp for zakatable assets that require one year
(trade inventory, money and livestock)
6. Only the net asset or income is subjected to zakat – debts and amount required
for min standard of living are deductible because among the essential needs
FAR658 Notes | Nursyazwani Izaty, 2024
ZAKAT ON LIVESTOCK
• When the owners have met the requirements for nisab and haul, the livestock is
zakatable
• Example: sheep, cows, buffaloes, goats, camels
• Livestock must be in good health, not crippled, not used in working in paddy fields or
transporting goods
• Animal used for personal use exempted from zakat (eating, riding, transport)
CONDITIONS OF LIVESTOCK GIVEN AS ZAKAT
1. Free from defects and damages
- The animal must not be ill, defective or old because it does not benefit the poor,
pregnant or looking after its calf is prohibited
3. Age requirement
- Specific ages for zakat must be complied with for the benefit of zakat recipient
FAR658 Notes | Nursyazwani Izaty, 2024
2. Silver
- Zakatable when own the value of 200 dirhams or 595 grams
- When the ownership fulfill haul conditions must pay 5 dirhams for every 200 dirhams
or 2.5% of zakat
ZAKAT ON MONEY (SAVINGS)
• Savings include:
- Cash in hand
- Cash in bank
- Money invests for investment
- Long term deposit in bank
• Zakatable when reached nisab ( 1 year)
• Nisab for cash is based on zakat for gold (85 grams)
• Money is calculated on the lowest balance in the savings account, if have more than
one savings account the total amount of lowest balance must be considered
• Money zakatable criteria – nisab (2.5%), passage of a year, money should be free from
debt, excess above basic needs
ZAKAT ON TRADING STOCK
• Referred as Urud al Tijarah – commodity obtained for resale or profit
• Eg: Goods/inventory for sale, money in hand or bank, debts & loans have been
extended to agents
• Zakat obligatory on the current market value
• Fixed assets are not subjected to zakat
ZAKAT FITRAH / AL FITR
• Given to poor people during Ramadan
• Contribution of a specific amount of staple food for equivalent amount paid
• Imposed on a flat amount on each person
• Not subjected to nisab and haul
• Aim is to purify Muslims from all minor mistakes they have committed