Q: Do all shareholders have to pay Zakat?
A: In terms of Zakat, there are two types of shareholder:
1) The person who buys shares as an investment and wants to attain dividends – this type of shareholder pays Zakat on the percentage of Zakatable assets on the balance sheet – NOT the entire market value of the shares
2) The person who buys shares to sell – i.e. trading stock. This type of shareholder must pay Zakat on the market value
And Allah knows best!
Mufti Faraz Adam
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