Zakat on gold, its minimum amount (nisab), and how to calculate it
Zakat on gold is the best way for a believer to purify wealth and relieve the distress of the poor. It is obligatory provided it reaches the nisab. Is there anything more beautiful than these acts of devotion to Allah, granting the giver a high status?
Therefore, we present this article to explore together the nisab of gold zakat, its conditions, how to calculate it, and the categories of people entitled to receive it.
Table of Contents
What is Gold Zakat?
Gold zakat is an obligatory form of zakat, whether in coins or bars, if the gold reaches the nisab. Allah says in Surah At-Tawbah: {Those who hoard gold and silver and do not spend it in the way of Allah, announce to them a painful punishment. On the Day it will be heated in the Fire of Hell and their foreheads, their flanks, and their backs will be branded therewith. This is what you hoarded for yourselves, so taste what you used to hoard.}
Gold and silver zakat is obligatory for every owner once the nisab is reached due to its great effect in growing and purifying wealth, alleviating the burdens of the poor, and improving their conditions.
Nisab of Gold Zakat
The nisab of gold zakat is 85 grams of pure gold, and the zakat rate is 2.5% of the total value of the gold. Zakat is obligatory for those who reach the nisab, to be paid from the stored or investment gold.
If the gold is sold, the zakat is 2.5% of the total money, but according to important conditions that must be fully met.
How to Calculate Gold Zakat
Before calculating gold zakat, the pure gold weight must be determined as follows:
Multiply the gold weight by 21 and divide by 24 if it is 21-carat gold.
Multiply the gold weight by 18 and divide by 24 if it is 18-carat gold.
Now you can calculate gold zakat using the following methods:
Method 1: Divide the total grams of gold the payer owns by 40 to get the zakat due.
Method 2: Divide the total gold weight by 10, then divide by 4 to get the zakat due.
Conditions of Gold Zakat
Several conditions must be met to pay gold zakat correctly and earn great reward:
- The gold must reach the nisab of 85 grams of pure gold.
- A full lunar year must pass while the payer owns the gold.
- The gold must belong to the payer with full ownership and no partner.
- The gold must not be pledged or borrowed.
- Zakat is only on gold coins and bars, not jewelry for personal use.
- Gold for decoration is not zakatable unless intended for investment or savings.
Zakat on Worn Gold
Worn gold refers to jewelry used for adornment, which is not zakatable if intended for personal use. It is zakatable if intended for savings and a full lunar year has passed.
Nisab of Worn Gold
The nisab for worn gold intended for saving is 85 grams of pure 24-carat gold or 97 grams of 21-carat gold. The zakat rate is 2.5% of the total weight.
Ruling on Saved Gold Zakat
Zakat on saved gold is obligatory if it reaches the nisab of 85 grams of 24-carat gold. A full lunar year must pass while the gold is hoarded. The zakat is 2.5% of the gold’s value, either in money or gold itself. Gold saved for marriage is also zakatable if purchased and stored.
Who Receives Gold Zakat
Gold zakat is distributed to the following eligible categories:
- Poor and needy people, who cannot secure food and drink for themselves.
- Debtors, to help them pay off debts.
- Travelers who have no money to return home.
- Workers who collect and distribute zakat.
- Those whose hearts are to be reconciled, for strengthening faith or goodwill.
- Slaves, to help free them from captivity.
- Jihad fighters and volunteers defending the religion, to help them prepare.
Frequently Asked Questions
How is gold zakat calculated?
Gold zakat is calculated by determining the pure gold weight, whether 21 or 18 carats, and multiplying by 0.025 or dividing by 40.
How much gold requires zakat?
The nisab for gold zakat is 85 grams of pure gold. A full lunar year must pass, and the payer gives 2.5% of the gold’s value.
Which gold is zakatable?
Zakat is obligatory on saved or investment gold or trade gold, provided it reaches the nisab.
Is worn gold zakatable?
No, personal-use jewelry is not zakatable. If saved and reaches the nisab with a full lunar year, it becomes zakatable.
Can zakat be given without weighing the gold?
Yes, it is permissible if there is certainty of giving the correct amount, or giving extra as a precaution.
What if gold zakat is not paid?
Not paying gold zakat is forbidden and a grave sin if the gold reaches the nisab and a year has passed.
Is zakat on used or saved gold?
Zakat is obligatory on saved gold if it reaches the nisab after a full lunar year. Jewelry for use may or may not be zakatable depending on its purpose and nisab.
Must gold zakat be paid annually?
Yes, gold zakat must be paid every lunar year if it reaches the nisab and is saved or intended for investment.
When should gold zakat be given?
Zakat is due after a full lunar year (365 days) on gold intended for saving or investment once the nisab is reached.
Can money and gold zakat be combined?
Yes, they can be combined if necessary to complete the nisab.
