Zakat liability drops upon the loss of one’s wealth due to factors out of one’s control such as fires, floods, theft etc. However, Zakat liability will only drop if these unfortunate events occurred without spending one’s money. Realistically, if these events occurred on one’s Zakat date or immediately after without using any of the funds, Zakat liability will be overlooked. This is the Hanafi school’s opinion.
For example, the Nisab was £200 and on the Zakat anniversary, Musa had £200. A day later, a spontaneous fire burnt the £200 worth of notes he had. In such a scenario, since the actual Nisab he held has been destroyed without his wrongdoing, foul play or without spending, the Zakat liability will drop completely as the actual Nisab and savings are no longer present.
This ruling is according to the Hanafi school who opine that Zakat liability is initially on the actual wealth itself rather than the liability of a person. Only after using the funds does the Zakat liability move onto oneself from the wealth. Thereafter, the Zakat remains a debt on the person.
However, according to the majority of schools of Fiqh, namely, the Maliki, Shafi’i and Hanbali schools, the Zakat liability is upon the individual from the outset. Therefore, a missed Zakat payment will not be written off upon the destruction of wealth on condition one had the ability to pay and did not paid.