Do I need to pay Zakat on my gold and silver?
Gold and silver in whichever form they are in (jewellery, coins, or ingots etc.) are all subject to Zakat.
If you own personal items made from a mixture of metals, then the gold/silver is liable to Zakat if the gold/silver content can be distinguished and ascertained.
Some scholars are of the opinion that mixed metals are only liable to Zakat if half or more of the metal is gold or silver.
How much gold/silver do you have to own before Zakat is payable?
This question can be answered in the context of your net assets. You then need to establish whether your net assets equal or exceed the Nisab threshold. If you exceed the Nisab threshold then Zakat is due on all your wealth at 2.5%.
Zakat is due on 2 types of precious metals – gold and silver.
Gold and silver are used as the basis for calculating your Nisab regardless of currency. This is the threshold of wealth you need to own before Zakat is due.
The gold Nisab should be used on gold assets. If there is a mixture of gold and silver assets, the silver Nisab should be used.
How do I calculate the value of my gold/silver?
Your local gold jeweller can tell you the current value of your gold assets.
They can do this in two ways:
They can give you the current value they would buy your gold at if you were to sell it
Or they can give you the weight of the gold and you can calculate the value using today’s live gold price in grams – this is known as the universal measurement. This is perhaps most suitable to ensure 100% accuracy.
Tolas, Boris and Voris
It is worth noting that in the South Asian subcontinent (i.e. India, Pakistan, Bangladesh and Nepal), grams may not be used to measure silver and gold. Instead one of 3 possible units of measurement may be used; these are either: Tolas, Boris or Voris.
One Tola or Bori or Vori is equivalent to 11.66 grams.
We know that the Nisab threshold for gold is 87.48 grams, so this is be equivalent to 7.2 Tolas, Voris or Bhoris.
What gold/silver items are Zakatable?
Gold or Silver jewellery and kept for wealth
Jewellery made of gold and silver that is held as a treasure and an accumulation of wealth is Zakatable.
Personal use ornaments
Items containing gold or silver purchased for personal use as ornaments are Zakatable. This includes ornaments used for house decoration and utensils (such as silver spoons etc).
Gold or Silver designated for personal use
There are differences of opinion regarding whether or not gold and silver jewellery that is kept for personal use should be exempt from Zakat. The safer option is to pay Zakat upon it as it is a doubtful matter, neither clearly made halal or haram.
Other precious metals, stones and mixed assets
Other precious metals like platinum and precious stones such as diamonds and rubies are not subject to Zakat.