How to Calculate Zakat on Gold, Silver, Cash and Savings

Zakat is one of the five pillars of Islam: a yearly payment of 2.5% of qualifying wealth, given to those in need. Calculating it can feel complicated, but it follows a few clear steps. This guide covers the common approach; for unusual situations, ask a qualified scholar.

Who has to pay zakat?

A Muslim who is an adult, sane and free, and who owns wealth above the nisab (the minimum threshold) for one full lunar year (hawl).

The nisab

The nisab is set by the value of:

• Gold: 87.48 grams (7.5 tola), or
• Silver: 612.36 grams (52.5 tola).

Because silver is much cheaper than gold, the silver nisab is far lower. Many scholars recommend using the silver nisab when your wealth is a mix of cash and other assets, because it means more people pay and more of the poor benefit. If your only wealth is gold, the gold nisab applies. Check the current gold and silver prices on the day you calculate.

What counts as zakatable wealth

Include:

• Cash at home and in bank accounts
• Gold and silver, including jewellery (scholars differ on jewellery worn regularly; the Hanafi view includes it)
• Savings, prize bonds and money others owe you that you expect to get back
• Business stock, valued at its current selling price
• Shares and investment funds (typically the zakatable portion of their value)

Exclude:

• Your home, car, furniture and personal belongings
• Tools and equipment used for your work
• Debts you owe that are due now, which can be subtracted

Step-by-step example

Ahmed's wealth on his zakat date:

Item	Value
Bank balance	400,000
Cash at home	50,000
Gold: 2 tola of 22K jewellery	2 tola × price per tola × purity
Business stock	250,000
Minus: bills due now	−30,000

Say the gold is worth 600,000 at today's price. His total zakatable wealth is:

400,000 + 50,000 + 600,000 + 250,000 − 30,000 = 1,270,000

This is above the nisab, so zakat due = 1,270,000 × 2.5% = 31,750.

Valuing gold correctly

Jewellery is valued by its gold content, not what you paid for it (which included making charges). 22K gold is about 91.6% pure, 21K is 87.5% and 18K is 75%. Use the tola to gram converter to convert weights and the gold price calculator to value jewellery by karat.

When to pay

Pick a fixed date each lunar year, many people choose Ramadan, and calculate your wealth on that date. You don't need to track every day's balance through the year, only that your wealth stayed above the nisab.

Who can receive zakat

The Quran (9:60) names eight categories, including the poor, the needy, those in debt and travellers in difficulty. Zakat can't be given to your parents, grandparents, children or grandchildren, whom you're already responsible for supporting.

Calculate yours

The zakat calculator adds up cash, gold, silver, investments and business assets, subtracts your debts, compares the total with the nisab and shows exactly how much is due.