Q: What does productivity mean for Zakatable assets?
A: Zakat is binding on wealth which is productive according to all four schools of jurisprudence.
Productivity in terms of Zakat refers to the potential of an asset to grow and increase. Productivity of an asset can be intrinsic as is the case with gold, silver and cash. Productivity can be activated by an intention to trade when purchasing stock or investing into Zakatable assets. And finally, productivity can be established through the breeding of flock.
Besides these three causes, the Shariah has not recognised any other cause of productivity. Personal assets and belongings which may appreciate will not be Zakatable despite growing in value as they are not productive wealth in Zakat terms.
And Allah knows best!
Mufti Faraz Adam
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