How zakat is calculated
Zakat is due each lunar year at 2.5% — one fortieth — of the qualifying wealth you have held for that full year, provided the total sits above a threshold called the nisab. Below the nisab, no zakat is owed.
Where the nisab comes from
The classical sources set the threshold at 20 gold dinars or 200 silver dirhams. Both were coins with a defined weight, so converting them into modern grams requires assuming a weight per coin — which is why you will see two sets of figures quoted:
| Convention | Gold | Silver |
|---|---|---|
| Commonly used | 85 g | 595 g |
| More precise conversion | 87.48 g | 612.36 g |
The difference between them is small — under 3% — and far less consequential than the choice between gold and silver.
Gold nisab or silver nisab?
This is the choice that actually matters. When the two thresholds were set, 20 dinars of gold and 200 dirhams of silver were worth roughly the same. They no longer are: gold has appreciated against silver enormously, so the gold nisab now sits many times higher than the silver one.
Most contemporary scholars recommend the silver nisab, on the grounds that the lower threshold brings more people into zakat and so directs more wealth to those entitled to receive it. Some scholars, particularly within the Shafi'i school, argue for the gold standard as the more stable measure of real wealth. Both positions are held by recognised authorities; this calculator defaults to silver but lets you choose.
What counts as zakatable wealth
Broadly: cash, gold and silver, business inventory held for sale, money owed to you that you realistically expect to recover, and investments held for growth. Your home, your car, your clothes and the tools of your trade are not zakatable — they are possessions in use, not accumulated wealth.
Debts you currently owe are deducted. The treatment of long-term debt such as a mortgage is disputed: some scholars allow only the coming year's instalments to be deducted rather than the whole outstanding balance, on the basis that deducting the full amount would exempt almost every homeowner.
The lunar year
Zakat is tied to the Hijri calendar, which runs roughly 354 days against the Gregorian 365. If you calculate on a solar year instead — a common practical choice for people whose finances run on a January-to-December basis — some scholars adjust the rate upward to about 2.577% to compensate for the longer period.
Sources and further reading
- Islamic Relief — what is nisab
- Zakat Foundation — nisab and calculation
- SeekersGuidance — gold or silver standard
Built by Mohammed Jamil, who is not a scholar. This tool does the arithmetic; the rulings behind it belong to people qualified to give them. Corrections to [email protected].