Are you supposed to count all monies held in your current account and saving and business current account as at today’s date even though I have not held that money for a period of one year? Or is Zakat due on savings I have held for a year from today’s date?
Once you have selected a Zakat anniversary on which to calculate and pay your Zakat, you should pay Zakat on all the cash in your possession on that date regardless of when that money came into your account as long as the total is above the Nisab threshold, which is currently about £225. The following year you will do the same thing on your Zakat anniversary based on the money you have with you on that day.
How often does Zakat have to be paid? I.e. Can it be paid monthly, or after 5 years in one go.
Is there a Sharia required period of time after which it comes sinful for not paying?
Zakat can be paid monthly in advance of one’s Zakat anniversary. Then a calculation is made and any balance should be paid off immediately. Paying in arrears is only permissible if there is a valid reason to do so, e.g. travelling abroad after the Zakat date with the intention of giving Zakat personally in cash. In this case, the limit for distribution should be one lunar year. Otherwise, Zakat should be paid immediately on one’s anniversary. Certainly, building up a liability for five years and paying in one go is impermissible.
I would like to know if it is acceptable for me to continue to spread the payment of my Zakat over the year after having made the intention that these various charitable donations (including one for a dawah institution) are for Zakat?
Once a calculation has been made on one’s Zakat anniversary, it is not appropriate to make regular Zakat payments in arrears unless there is a very good reason to do so. Zakat should be discharged immediately or as soon as possible after the Zakat anniversary.
However Zakat can be paid over the course of the year in advance. So for example if my Zakat anniversary is 1st Ramadan and I have paid my Zakat for this year, I can start to pay Zakat in advance in respect of next year’s Zakat anniversary. Let’s say I start to give £50 a month. Then on 1st Ramadan next year I calculate my Zakat liability at £800. If I have already paid £600 over the course of the year, then I will only need to pay £200 on 1st Ramadan next year to complete my Zakat.
If you didn’t record the original date you reached Nisab and pay your Zakat approximately one month later, going forward for the following year what should be done? i.e. what date should you use? If you fall below Nisab during the year can you continue giving on the same date?
1. If you now know the original date on which you crossed the Nisab, then you should use this original Zakat anniversary date for next year even though the last payment was effectively paid a month late.
2. If you fall below the Nisab during the year, then you should continue on the same date. The only scenario where your date resets altogether is when your net Zakatable assets fall to zero or below zero. In this case you will wait until you come above the Nisab again and then pay Zakat after one lunar year from this new date.
I initially calculated my Zakat according to my yearly income and expenditure and my Zakat totalled £83. However I am paid monthly so wanted to set up a monthly Zakat payment so I re-entered my monthly income and expenditure but it says I have no Zakat liability. Can you help me arrange to calculate and pay a monthly sum over the Zakat year as I would like to avoid paying Zakat on an income I am yet to receive. I would prefer to just pay it after each pay cheque. Is that acceptable or must it be paid yearly in advance? Or in arrears?
You should have a single date in the Islamic calendar on which you calculate your Zakat.
You are permitted to pay in advance but not in arrears unless there is a very good, specific reason for doing so.
Let us say 29th Ramadan is your Zakat anniversary, you should consider your financial situation on that date and add up all your Zakatable assets. You then take 2.5% to work out your Zakat payment.
Let’s say it comes to £200 and you make a payment.
You can then also start to pay Zakat in advance for the following year.
For example, let’s say you start paying £10/month of Zakat and by the time it’s 29 Ramadan next year you’ve paid £120 already. Then you calculate your Zakat again and it comes to £200 again. Now you only have £80 left to pay to complete the payment.