How to Calculate Zakat: A Practical Step-by-Step Guide

· 1 min read · Zakat & Islamic Finance

Zakat is one of the five pillars of Islam, and for most people it comes down to a simple question: how much of my wealth is zakatable, and does it clear the Nisab threshold? Here's how to work it out properly.

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Step 1: Add up your zakatable wealth

Zakatable wealth generally includes:

  • Cash on hand and in bank accounts
  • Gold and silver (jewelry included, per most scholarly opinions)
  • Investments and trade goods held for growth or resale

It does not usually include your personal home, car, or household items for personal use.

Step 2: Subtract short-term debts

Debts you owe and are due within the year can be deducted from your total before checking against the Nisab.

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Step 3: Check against the Nisab

The Nisab is the minimum threshold of wealth that makes Zakat obligatory — typically based on the value of 85 grams of gold (or 612.36 grams of silver, per some scholars). This value changes daily with the gold price, so check today's figure with your local zakat authority before calculating.

If your net zakatable wealth is at or above the Nisab, and you've held it for a full lunar year (Hawl), Zakat is due at 2.5% of the total.

Frequently asked questions

Do I pay Zakat on my salary?
Not directly — Zakat is due on wealth you hold, not income you earn. If part of your salary is saved and held for a full year above the Nisab, that saved portion becomes zakatable.
What if my wealth is below the Nisab?
No Zakat is due. The Nisab threshold exists precisely to exempt people without sufficient surplus wealth.
Is Zakat 2.5% of income or of wealth?
2.5% of your total qualifying wealth held for a full lunar year, not of your income.

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