Introduction

Zakat or alms-tax, the third pillar of Islam, is the obligatory giving of ones wealth to those who are in need of it. It is a fixed 2.5% tax on ones wealth, above a minimum threshold level called nisab. This includes gold, silver, cash, stocks, shares, investment property, business assets and agricultural assets. One must have this amount of wealth for a period of one lunar year (354 days) for zakat to become due on it.

Another form of zakat which is obligatory is Fitrana. This is given in the month of Ramadan, before Eid al Fitr. This is an individual zakat due for every Muslim, young or old, rich or poor and not determined by a persons wealth. It amounts to 3.5 kg of grain, or its equivalent cost, approximately £4-5.

Spend in charity, O son of Adam, and I shall spend on you [Bukhari]

Zakat

Why Give Charity?

Zakat is obligatory on those Muslims who have sufficient wealth above the nisab value. Voluntary charity (sadaqah) also has many blessings, both spiritual and worldly.

The importance of zakat is highlighted in several ayats within the Quran which link it with salah, for example [2:83], [2:110], [5:12], [9:5], [24:37], [58:13], [98:5]:

All provision is from Allah SWT. Therefore all that we have is His and should be spent in His way. Such charity helps to purify ones wealth and ones soul. It releases us from our love of money and other worldly possessions and protects us from greed and miserliness.

Take from their wealth charity to purify and bless them [9:103]

We use the wealth we have been blessed with to provide for and support those who are less fortunate. Funds are used to provide food and water, housing, schooling and to help people lift themselves out of poverty and be able to support themselves and their families. Thus zakat and sadaqah are important tools in helping to establish equality within the community.

One who gives charitably will never be poor. Allah SWT mentions several times in the Quran [2:245], [5:12], [57:11], [57:18], [64:17], [73:20] that whosoever lends Him a righteous loan will have it multiplied many times. Not only that, charity expiates sins and averts calamities [Tirmidhi]. Being charitable connects us to Allah SWT and is an investment in our Akhira.

If you lend to Allah a good loan, He will multiply it for you and forgive you. For Allah is Most Appreciative, Most Forbearing [64:17]

Calculating Zakat

The nisab value was set by the Prophet Muhammad ﷺ as equivalent to 87.48 g of gold and 612.36 g of silver. As these metals are not used as currency today, the nisab value is calculated using the current price of gold or silver. This equates to approximately £4175 for gold and £338 for silver.

If one has only gold as their assets, they use the nisab value for gold and pay zakat on anything over that level. However, as most people nowadays have a mixture of asset classes, the nisab value for silver is commonly used. This means more of ones wealth is subject to zakat, which is beneficial for both the giver and the recipients.

Beneficiaries of Zakat

Surah Tawba describes those who are eligible to recieve zakat [9:60]:

• The Poor.
• The needy, those who are not obviously destitute but require support.
• Zakat collectors, to help with administrative costs.
• Poor and needy recently converted to Islam.
• Slaves, in order to be freed.
• Those in debt.
• Those who are away from home striving in the path of Allah.
• Travelers in need of financial assistance.

Etiquette and Benefits of Charity

• One should give sincerely in the cause of Allah SWT.
• One should not boast or show off with their charity – it will not be accepted. To give in secrecy is best.
• Zakat and sadaqah should come from halal sources of money.
• Charity begins at home – ones extended family should be the first recipients if in need, followed by the local community and then others.
• Ones immediate family (parents and children) are not beneficiaries of zakat as one already has a duty to provide and support them.
• Charity removes sins and averts calamities [Tirmidhi].
• Charity will be a shade on the Day of Judgement [Tirmidhi].
• All of society benefits from the removal of poverty.
• Charity purifies and improves one character, ridding one of negative traits such as greed and miserliness.
• It brings a good feeling into ones heart for helping people more unfortunate. This positivity leads to increased charity.
• It raises the rank of a believer. None of you believes until he loves for his brother what he loves for himself [Tirmidhi].
• Charitable giving brings one closer to Allah SWT.

Voluntary Charity

Sadaqah

Voluntary charity does not simply equate to monetary donations. Any of our actions can be a form of charity. A kind word or a smile is charity [Bukhari; Tirmidhi]. Spending ones time with others in need or visiting the sick is charity. Helping someone with something they are in need of, or removing objects of harm from ones path can be charity.

Such forms of charity serve to help improve our characters and develop love and concern for our brethren. They will also bring us closer to the Sunnah of the Prophet Muhammad ﷺ and to Allah SWT.

Sadaqah can be given as a penance for sin, as thanks for something good that has happened or thanks for aversion of an accident. The best forms of sadaqah are feeding the poor and giving water.

Sadaqah Jariyah

Longer lasting forms of sadaqah, referred to as sadaqah jariyah, are those whose benefit will continue for as long as the act of charity remains. This can often be beyond the death of the giver, resulting in ongoing blessings and rewards for that person.

Such sadaqah jariyah includes:

• Providing knowledge that benefits someone:
  • Teaching someone to read Quran.
  • Educating someone on their religion.
  • Teaching someone a beneficial skill.
• Building a masjid. Whoever builds a mosque for the sake of Allah, Allah will build for him a house in Paradise [Bukhari].
• Building a school. This provides education for children allowing them to seek better professions and enable them to support their families.
• Building a well. The best charity is giving water to drink [Ahmad].

When the human being dies, his deeds end except for three: ongoing charity, beneficial knowledge, or a righteous child who prays for him [Muslim]