Most zakat errors are not arithmetic errors. They are valuation errors — people count the wrong things, use the wrong nisab, or deduct the wrong debts. Get the method right and the calculator becomes trivial.
Rates below are illustrative retail levels of late September 2026 (gold ~₹15,300/g, silver ~₹188/g). Always re-check today’s market rate on your zakat date — and confirm personal rulings with a qualified scholar via our Darul Iftah.
Step 1 — Work Out Your Nisab
Nisab is the minimum wealth at which zakat becomes due: 87.48 grams of gold or 612.36 grams of silver, valued at the current market rate on the day your zakat year ends.
Which threshold? The Hanafi school — and most contemporary zakat bodies serving South Asia — recommend the silver nisab, because it is lower and brings more people into paying. Others use the gold nisab. This is a real difference of opinion, not a rounding error: at current rates the silver nisab is roughly ₹1,15,000 while the gold nisab is roughly ₹13,38,000. A person holding ₹2,00,000 in savings owes on the silver standard and not on the gold — which is exactly why the choice matters. Pick one, be consistent, and if you follow a school, follow it.
Step 2 — Fix Your Zakat Date
Zakat falls due on wealth held above nisab for one complete lunar year (hawl). Most people pick a date — 1 Ramadan is common — and use it every year. Wealth acquired mid-year is added to the total at the date; you do not track each item separately.
Step 3 — List Your Zakatable Assets
| Asset | How to value it |
|---|---|
| Cash in hand | Face value |
| Bank balances (current + savings) | Closing balance on your zakat date |
| Gold — jewellery, coins, bars | Market value at today’s rate |
| Silver — same | Market value at today’s rate |
| Business stock | Current resale value, not purchase cost |
| Receivables you expect to be paid | The amount owed to you |
| Shares, mutual funds, SIPs | Market value on the date |
| Rental property | The rental income saved, not the property |
On gold jewellery: the Hanafi position is that all gold — worn or not — is zakatable. The Shafi’i position exempts jewellery in regular use. Many South Asian families follow the Hanafi view — one of the most common sources of underpayment.
Step 4 — Deduct What Is Genuinely Deductible
Deduct immediate, due debts — unpaid bills and rent, short-term loans due within the year, money owed to suppliers. You do not deduct the full balance of a long-term mortgage (opinions differ; some deduct the current year’s instalments only). Do not subtract future living expenses, nor the value of your home or car.
Step 5 — Apply 2.5%
If net zakatable wealth is at or above nisab: zakat = net wealth × 2.5% (divide by 40).
Worked Example (illustrative rates)
| Item | Amount (₹) |
|---|---|
| Cash in hand | 40,000 |
| Bank balance | 3,20,000 |
| Gold, 100g @ ₹15,300/g | 15,30,000 |
| Silver, 500g @ ₹188/g | 94,000 |
| Business stock | 1,50,000 |
| Receivables | 50,000 |
| Subtotal | 21,84,000 |
| Less: due bills and short-term loan | (1,20,000) |
| Net zakatable | 20,64,000 |
| Zakat due (2.5%) | ₹51,600 |
Step 6 — Pay, and Don’t Confuse It With Fitr
Zakat goes to the eight categories named in Quran 9:60 — the poor, the needy, those employed to collect it, those whose hearts are to be reconciled, to free captives, the debt-burdened, in the cause of God, and the traveller. Zakat al-fitr is separate: a fixed amount per person before the Eid prayer. Paying fitr does not discharge zakat.
Common Mistakes
- Using purchase price instead of current market value for gold
- Forgetting silver entirely — often meaningful value
- Deducting a full 20-year mortgage and concluding nothing is owed
- Missing accessible provident fund or SIP balances
- Valuing assets at the wrong date
- Assuming zakat clears previous years’ arrears — arrears must be calculated and settled
Frequently Asked
You pay on what remains and is held. If salary is spent before your zakat date, only the balance counts. No, if not held for sale. Property held for resale is treated as trade stock. If you expect repayment, yes — count it as a receivable. If doubtful, many scholars defer until paid, then pay for one year. Yes, as an advance against the year’s liability, reconciled at your zakat date. If it belongs to adult children meeting nisab, it is theirs to pay. Gold held for minors is generally not zakatable under the Hanafi school.Do I pay zakat on my salary?
Do I pay zakat on a property I own but don’t rent out?
Is zakat due on a loan I gave someone?
Can I pay zakat monthly?
Do I pay zakat on my children’s gold?
Give your zakat where students of knowledge benefit: verified Trust accounts, sponsor a student, scholarships — or ask our Darul Iftah about your case.