Zakat Expert

I receive dividends from a company in which I am a shareholder. Do I pay Zakat on this or keep my personal wealth separate?

Zakat is an INDIVIDUAL measurement – so the onus and responsibility is on the individual to both pay it and to calculate how much he or she owes. Zakat is calculated on the amount of income a person has in hand after paying for all of their essentials during one full lunar year. Zakat is merely calculated on your disposable income (when we say disposable income, we mean the income that you have left over after fulfilling the essential needs of yourself and your dependents. When calculating Zakat, business assets must be taken into account. If your net assets do not equal or surpass the Nisab threshold then you are exempt from paying Zakat when it is due.

In short, the value of the dividends would be added to your other Zakatable assets.

Approved by Mufti Amjad 7th August 2023

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