Understanding Nisab to Understand Zakah

To distinguish between the "poor" and the "Zakah-payer," a limit was set and was called Nisab. According to Abu Saud, the basic definition of Nisab is "that amount which is sufficient to sustain the minimum average family for one year." Such limit of "sufficiency" parallels the definition of "poverty" in the United States.

Nisab may be thought of as an amount equal to the essential needs of a person or family for one year. Essential needs are defined as things which one could not live without: food, clothing, dwelling, vehicles and the tools of one's trade or profession, medication, and education.

Above the limit of Nisab
If your net worth surpasses the level of Nisab, the excess is subject to Zakah. Zakah is the right of the poor in the wealth of the rich, a right decided by the true Owner and Giver of wealth, Allah, and imposed on those who have been given control of that wealth by Him, the Almighty. Zakah is incumbent upon all Muslims and is paid according to the lunar calendar.

No Zakah is due on wealth before one year from the date of acquisition. The most well known hadith is that, on the authority of Aishah, the Prophet said: “No Zakah is due on wealth till one (full) year passes”.

 

Continue to Who Receives Zakah?

 

Zakah guide compiled by M. Yaqub Mirza, Ph.D. & Saturna Capital Corporation.

The methodology for Zakah calculation discussed herein has been reviewed and approved by the Fiqh Council of North America, Sharia Consultants to Amana Mutual Funds Trust. Scholarly references available on request.

Amana Mutual Funds Trust, Saturna Capital Corporation, and Saturna Brokerage Services, respectively, do not make any warranty, express or implied, and they disclaim any warranty about (i) the results to be obtained by any person in connection with the use of the Zakah calculation method outlined above (“Zakah Calculation”); (ii) the accuracy or completeness of the Zakah Calculation; and (iii) its compliance with Sharia law and other Islamic principles. Amana Mutual Funds Trust, Saturna Capital Corporation, and Saturna Brokerage Services will not be liable for any errors or omissions in the Zakah Calculation.

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