If I owe money to my family member who gave me a loan, can I deduct that loan from my Zakat calculation?
We have now changed our position in relation to the treatment of personal loan in the Zakat calculation. Our current ruling is the following: any personal debt that will be repaid in the forthcoming 12 lunar months can be deducted.
If you have the intention to repay the loan or some of it then you can make the deduction, however, if despite making the deduction you do not make the repayment, then on the following year you will have to make the adjustment to your Zakat payment and pay Zakat on the amount you initially deducted.
And Allah knows best!
Reviewed 22/11/2021