Question:
I wanted to ask if zakat is due on company RSUs? My company vests me some company shares every few months which I can sell after a year. My intention is not to sell them straight away – but keep them for a longer time. For example, I still have shares which were vested to me in year 2020. Do I pay 2.5% Zakat on the value or shall I apply the 25% formula?
Answer:
Restricted Stock Units (RSUs) are a commitment by an employer to grant company shares to an employee after a specified vesting period. Until the shares vest, they remain a promise, and no zakat is due. Once the RSUs vest and the shares are transferred to the employee, zakat becomes applicable.
Zakat is calculated based on the zakatable assets of the company. If this cannot be determined, 25% of the total market value of the shares can be used as an estimate. Even if the intention is to sell the shares after vesting, zakat is not due on the full market value, as these shares were not originally acquired for trading purposes.
Answered by Mufti Billal Omarjee
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