Zakat on gold, savings, livestock and business

What kinds of wealth are zakatable?

Zakat applies to wealth that grows or can grow: cash, precious metals, trade goods, farm produce and grazing animals. It does not apply to things you use daily, such as your home, personal car, clothes and furniture.

For the basics, such as who pays and the nisab, see Zakat in Kenya.

Do I pay Zakat on savings, M-Pesa and bank accounts?

Yes. Money in your bank account, Sacco, M-Pesa wallet or at home is zakatable once your total is above the nisab for one lunar year. Pay 2.5% of the total on your Zakat date.

Add up all balances, including savings you set aside for a future plan. Subtract debts that are due now. If you save for a big expense, the money is still counted unless it is needed to pay a debt that is due.

Retirement funds, pensions and Sacco shares have more detailed rules. Scholars differ on when Zakat is due on funds you cannot yet withdraw, so ask your local scholar.

Do I pay Zakat on gold and silver jewellery?

Yes on gold and silver bars, coins and savings. For jewellery that you wear, scholars have different views.

• Some scholars say Zakat is due on all gold and silver, even if worn as jewellery.
• Others say worn jewellery for personal use is not zakatable.

To be safe, many people pay Zakat on their jewellery. Ask your local scholar which view to follow. To work out the value, weigh the pure gold or silver and multiply by the current price per gram. Pay 2.5% if you pass the nisab.

How do I pay Zakat on my business?

For a business, Zakat is paid on the goods you hold for sale, the cash you have and the money customers owe you that you expect to receive. You do not pay on shop fittings, shelves or a delivery vehicle you use to run the business.

• Count stock at its current selling price, or cost price, as your scholar advises.
• Add cash in the till, bank and M-Pesa till or wallet.
• Add debts owed to you that you expect to get back.
• Subtract short-term debts you must pay soon, such as supplier bills.
• Pay 2.5% of the result if it is above the nisab for a year.

For example, a shop owner in Mombasa with KES 600,000 of net zakatable business wealth would pay KES 15,000. The figure is only an example.

Do I pay Zakat on livestock like camels, cattle, goats and sheep?

Yes, on grazing animals once the number reaches a minimum and the animals have been owned for a year. This is very important in Kenya for pastoralist communities in Garissa, Wajir, Mandera, Turkana and Marsabit.

The rates are not 2.5%. Zakat on livestock follows special tables that depend on the kind of animal (camels, cattle, goats and sheep) and on how many you own. Many scholars also say that the animals must mostly graze freely, and are not fed fully by their owner.

Because the tables are detailed, ask your local scholar or imam to work out your Zakat with you. Zakat on livestock can be paid by animals or by their cash value, and scholars differ on this. Read about who can receive it in Who can receive Zakat?

Do I pay Zakat on crops and farm produce?

Yes. Crops are paid at harvest, not after a year. The usual rate is 10% if the crop was watered by rain, and 5% if it needed irrigation that cost effort or money.

There is a minimum harvest amount, and scholars differ on which crops count. Ask your local scholar if your farm produce is maize, beans, tea, coffee, vegetables or fruits.

Can I subtract my debts before paying Zakat?

Most scholars say you subtract debts that are due soon, such as bills, rent and loan instalments, before working out your Zakat. You do not subtract the whole of a long loan, such as a mortgage, in all views.

Scholars differ here, so ask your local scholar how to treat a long loan, a car loan or a business loan.

How do I pay my Zakat in Kenya?

Once you know the total, you can give through the Islamic Relief Kenya donation page. Choose the ZAKAT fund and pay by card or M-Pesa. You can also use Lipa na M-Pesa: PayBill 949210, account name ZAKAT.

Islamic Relief Kenya is registered with the Kenya NGO Board (Reg. No. 218/051/204/0374/3386). For a step by step tool, use the Zakat calculator (KES).