How to Calculate Zakat on Money, Gold and Savings

Zakat is the third pillar of Islam: an annual payment of 2.5% on qualifying wealth, purifying your money and supporting those in need. Calculating it is simpler than most people think once you know the nisab and what counts as zakatable wealth.

Step 1: check the nisab

Zakat is only due if your zakatable wealth stays at or above the nisab for one full lunar year (hawl). The nisab is the value of 85 grams of gold or 595 grams of silver — most scholars today recommend using the silver standard so that more wealth reaches the poor. Check today's gold or silver price to get the current threshold in your currency.

Step 2: add up your zakatable assets

• Cash in hand and in bank accounts (including savings).
• Gold and silver (jewellery according to many scholars — check your madhhab).
• Business inventory valued at selling price.
• Shares and investments (market value; long-term holdings may use the underlying zakatable assets).
• Money owed to you that you realistically expect to be repaid.

Step 3: subtract immediate liabilities

Deduct debts due now or within the coming year — rent due, bills, instalments, borrowed money you must repay soon. Your home, car, clothes and household items are not zakatable and are not part of the calculation.

Step 4: pay 2.5%

If the remaining amount is at or above the nisab, your Zakat is that amount × 2.5% (or ÷ 40). Example: you have $8,000 in savings, $2,000 in gold and $1,000 of upcoming bills. Zakatable total = $9,000. Zakat = $9,000 × 0.025 = $225.

Who receives Zakat

The Quran (9:60) names eight categories, chiefly the poor and needy. It cannot be given to your dependants (parents, children, spouse). It should be paid without delay once due.

Skip the spreadsheet — use Noor's free Zakat calculator, which walks through each asset type and applies the nisab automatically.