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    Thread: Zakah on Gold, Silver, Currencies,Ornaments, Shares, Securities etc.

    1. #1
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      Zakah on Gold, Silver, Currencies,Ornaments, Shares, Securities etc.

      Zakah on tender (gold, silver and currency)

      Definition of legal tender:
      The phrase 'legal tender' implies all currencies whether banknote or coins, no matter whether they belong to the country of the payer of Zakah or not.

      Obligation of Zakah upon legal tender:
      Zakah upon legal tender is supported by proofs from the Holy Qur'an, the Sunnah and the unanimous agreement of Jurists. The Holy Qur'an says, "And there are those who bury gold and silver and spend it not in the Way of Allah: announce unto them a most grievous penalty. On the Day when heat will be produced out of that (wealth) in the fire of Hell, and with it will be branded their foreheads, their flanks, and their backs, this is the (treasure) which ye buried for yourselves: taste ye, then, the (treasures) ye buried!" (Surah Al-Taubah No.9, Verse: 34-35).

      As for the Sunnah, the Prophet said, "What you keep for yourself after paying the Zakah due upon it is not a hoard." The Prophet also said, "Owner of gold or silver who does not pay the poor due (Zakah) will have bitter punishment on the Day of Resurrection. Plates of fire would be beaten out for him; these would then be heated in the fire of Hell and his sides, forehead and back would be cauterized with them".

      Throughout ages all Muslims unanimously agreed that Zakah is due on silver and gold, and thus the rule extended to all other types of currency by way of analogy. According to the statement No.9 issued in the third session of the Islamic Jurisprudence Academy in Jeddah: All paper currencies are considered potential money that has the purchasing power and receive all the legal rules applicable to gold and silver as regards profit-taking, Zakah, payment in advance and other rules.

      The Nisab of legal tender
      Zakah becomes due once the property of a certain person reaches the minimum amount defined by Islamic law as liable to paying Zakah.
      The minimum amount of gold or gold currency counted for Zakah is 20 mithqals (4.25 grams of fine gold).

      The minimum amount of silver or silver currency counted for Zakah is 200 dirhams (595 grams). A silver dirham is equal to 2.975 grams.

      The statement issued by the Islamic Research Academy, in its 2nd conference, stipulated that estimating the Nisab liable to Zakah on banknote, coins and commercial commodities should be based on their corresponding minimum amount of gold, since the value of gold is more stable than any other kind of property.

      To determine the value of gold as opposed to the currency in use, one should consult an expert.

      Some researchers claim that choosing gold as a criteria for determining the value of currency is attributed to its being assumed as a cover fund, even partially, to support the banknote issued by any given country. Besides its being the basis on which the value of banknote is determined, gold itself is considered an international currency and a standard criterion to measure the value of all currencies in the world. However, it is established that the value of gold may vary in accordance with the change of time or markets.
      According to the Hanafi Juristic School, the value of gold may be added to the value of silver so as to complete the minimum amount counted for Zakah. If still beyond the minimum amount, the value of commercial commodities may also be added. The Nisab liable to Zakah on cash, banknote and coins is to be determined according to its corresponding value of gold (85 grams of fine gold), based on the current rates of the country in which the payer of Zakah is resident.

      In case the gold is not fully pure, Zakah is to be paid on the net weight of gold after leaving out the weight of other substances.

      On the 18 carat gold, for example, Zakah is to be paid after leaving out one-fourth of the total weight, representing 6 carats out of 24 carats.

      On the 21 carat gold, Zakah is to be paid after leaving out one-eighth of the total weight, representing 3 carats out of 24 carats.

      The same applies to the silver that is not fully pure.

      Requisites of Zakah on gold, silver and currencies:
      They are the same as those stipulated to pay Zakah, which have been explained earlier. (See: Requisites of paying Zakah)

      The amount of Zakah payable on silver, gold and currencies:
      The mount payable is a quarter of a tithe (2.5%).

      How to calculate in cash the amount of Zakah on gold and silver
      One who prefers to pay Zakah on gold and silver in cash may multiply the amount counted for Zakah by the rate of grams. This will give the amount of Zakah in cash. For example, in case the amount of gold liable to Zakah is 25 grams and a gram value is 4 dinars, we may reach the amount of Zakah payable in cash by making use of the following equation: The amount of Zakah = 25 grams (of gold) x 4 dinars (the rate of gram) = 100 dinars.

      Zakah on ornaments and gold and silver objects
      Abu Hanifah and Ibn Hazm hold that zakah is compulsory on gold and silver jewelry provided they constitute a nisab. Their view is based on the report of 'Amr ibn Shu'aib from his father from his grandfather: "Two women with gold bracelets on their wrists came to the Prophet, upon whom be peace. The Prophet said: 'Do you want Allah to make you wear bracelets of fire on the Day of Judgment?' They answered: 'No.' He said: 'Then pay the zakah which is due on what you wear on your wrists.' "

      In the same way, Asma' bint Yazid reported: "My aunt and I, while wearing gold bracelets, went to the Prophet, upon whom be peace. He asked: 'Did you pay their zakah?' She related that they had not. The Prophet said: 'Do you not fear that Allah will make you wear a bracelet of fire? Pay its zakah.' " Al-Haythami confirms that it was narrated by Ahmad, and its chain is good.

      'Aishah narrated: "The Messenger of Allah, upon whom be peace, came to me and saw me wearing silver rings. Thereupon, he asked: 'What is this, 'Aishah?' I replied: 'I made them to adorn myself for you, O Messenger of Allah.' He said: 'Did you pay their zakah?' I said: 'No, or what Allah wishes.' Then he said: 'Their punishment in Hell is enough for you.' " This is related by Abu Dawud, ad-Daraqutni, and al-Baihaqi.
      Malik, ash-Shaf'i, and Ahmad ibn Hanbal hold that there is no zakah on women's jewelry regardless of its value. Al-Baihaqi relates that Jabir ibn 'Abdullah was once asked if jewelry was subject to zakah. He replied that it was not, even if its value exceeded one thousand dinars.

      The amount of Zakah due on gold and silver ornaments is 2.5%.

      Zakah is obligatory on gold and silver ornaments unlawful to wear:
      Such unlawful ornaments may include gold bracelets and watches worn by men.
      Zakah is obligatory on unlawful gold or silver ornaments so long as they reach the allotted Nisab, or when added to other jewelry. The Nisab of gold and silver possession has been previously explained. Legal tender may be added to the value of gold and silver in calculating Zakah money. Likewise, items of commercial commodities may be added to one another.
      Zakah on securities

      Legal judgment concerning dealing in securities:
      A security represents a part of a loan owed by the company or the body that gives this security. A fixed interest, which is not affected by the company's profits or losses, is to be offered on this security. However the company is obliged to repay the loan at a determined time. A security has a nominal value, that is the original value, and a market value, which is determined by demand and supply.

      Dealing in securities is prohibited as it brings about a usurious interest. Likewise, disposing of securities by selling or buying is regarded as selling the debt to other than the debtor, which is not lawful.

      How to pay Zakah on securities?
      Though dealing in securities is not lawful, Zakah is due on their par value, which is to be added to other kinds of property, after reaching the Nisab and the lapse of a full year. The payable amount of Zakah is a quarter of the tithe. All usurious interests gained from securities are to be spent in charitable purposes, in a way to assist the common good except in building mosques and printing copies of the Holy Qur'an.
      However, this spending will be regarded a means to get rid of the ill-gotten gain, but not a Zakah. One is not allowed to spend thereof on himself or on his household. It is recommended that the owner should dedicate it to those affected by famines, strains, disasters and the like.

      Zakah on shares:

      Legal judgment concerning dealing in shares:
      A share indicates any of the equal interests or rights into which the entire capital stock of a corporation is divided. Holding shares is regularly evidenced by one or more certificates. It is liable to gain or loss. A shareholder is free to sell his shares whenever he likes.
      A share has a par value, determined when first issued, and a market value determined on the basis of supply and demand in the banknote markets in which the shares are circulated.
      Holding shares in a joint-stock company is judged on the basis of the kind of company activities. Thus, sharing in a company that has usurious dealings or produces prohibited commodities such as alcoholic drinks is unlawful. Likewise, sharing in a company that applies certain prohibited kinds of transactions such as usurious on credit sale or aleatory transactions is also unlawful.

      How to pay Zakah on shares?
      In case the company pays Zakah on its shares, the shareholder is not obliged to pay Zakah on his shares to avoid twice giving Zakah.

      Otherwise, a shareholder will be obliged to pay Zakah on his shares as follows:
      In case the shareholder exploits his shares in trade, the amount of Zakah due on his shares would be 2.5%, according to the market value at the time Zakah becomes due.

      However, if shares are invested to obtain annual revenues, Zakah is paid in the following way:
      a) If the shareholder managed to examine the accounts of the company and know the amount of Zakah due on his shares, he would have to pay a quarter of the tithe (2.5%) as Zakah on this basis.
      b) If he does not have knowledge of the company accounts, he may simply add the share revenues to the total sum of his property counted for Zakah and pay a rate of 2.5% as Zakah after the lapse of a full year since the wealth has reached the allotted Nisab.
      Zakah on debts

      A debt is defined as an amount of money owed by someone. It is counted for Zakah in case it is recoverable. After repayment, money is to be added to the total sum of properties counted for Zakah. However, the debt owed by the payer of Zakah is to be excluded from the total sum liable to Zakah as follows:
      a) The amount of debt owed by the payer of Zakah is to be excluded from the portion liable to Zakah, provided that he remains in debt before Zakah falls due and finds no other property not liable to Zakah that exceeds his basic needs to repay his debt therefrom.
      b) A payer of Zakah who has more than one type of property counted for Zakah may specify a certain type of these properties to repay his debt therefrom and dedicate the rest, which should be more beneficial to the poor, to Zakah.
      c) In long term, installment debts, like housing installments, and other debts that finance fixed assets, which are not counted for Zakah, the payer deducts the amount of annual installment all at a time, then calculates the total sum of the remaining property and pays Zakah on it if it reaches the Nisab of Zakah.
      d) Loans that are invested to finance any commercial business are to be deducted from the total sum liable to Zakah, in case the payer does not have fixed assets exceeding his basic needs.
      e) Loans invested to finance industrial projects are to be deducted from the total sum of properties counted for Zakah, in case the debtor has no fixed assets exceeding his basic needs to cover these loans. However, in case there are fixed assets to cover these loans, they will not be deducted from the total sum of the properties counted for Zakah.

      In case the amount of these fixed assets falls short from covering the whole amount of loans, the remaining uncovered portion is to be deducted from the total sum counted for Zakah. In case of deferred investment loans, only the amount of the annual installment, which falls due, is deducted.

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      Re: Zakah on Gold, Silver, Currencies,Ornaments, Shares, Securities etc.

      V good bitya

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      Re: Zakah on Gold, Silver, Currencies,Ornaments, Shares, Securities etc.

      Great sharing

      اعتماد " ایک چھوٹا سا لفظ ھے ، جسے
      پڑھنے میں سیکنڈ
      سوچنے میں منٹ
      سمجھنے میں دِن

      ثابت کرنے میں زندگی لگتی ھے

    4. #4
      ...."I don't need your attitude. I've my own"..... www.urdutehzeb.com/public_htmlwww.urdutehzeb.com/public_html Arosa Hya's Avatar
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      Re: Zakah on Gold, Silver, Currencies,Ornaments, Shares, Securities etc.

      aisi posts na mjy bs urdu mai achi lti hain thora asan ho jata hai lambi post parhna

      anyways thanks to share
      ood effort

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