20 Jan 2025
Zakat and Mortgages
Mortgages are long-term debts. Scholars differ on whether you can deduct them from your zakatable wealth.
Clear, evidence-led guidance to help you understand Zakat and make confident decisions—step by step.
Understand the basic concept of zakat so that you can fullfil your obligations with confidence and without doubt.
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Zakat is the third pillar of Islam, a mandatory act of worship that purifies wealth and supports the community.
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Zakat exists to purify wealth and create a just society. It is a command from Allah with deep spiritual and social benefits.
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Not everyone must pay Zakat. You must meet four specific conditions before Zakat becomes obligatory.
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Zakat becomes due after you have held qualifying wealth above nisab for one full lunar year.
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Your Zakat goes to eight specific categories of people. The Quran defines exactly who can receive it.
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Zakat and Sadaqah are both forms of giving in Islam, but they are fundamentally different. One is obligatory, the other is voluntary.
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Nisab is the minimum amount of wealth you must own before Zakat becomes obligatory. It is based on the value of gold or silver.
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The nisab can be calculated using gold or silver. The two values differ significantly, and your choice affects whether Zakat is due.
Learn which types of wealth are subject to zakat and how to assess them accurately.
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Not all wealth is subject to Zakat. Islam defines specific types of wealth that must be included in your calculation, and others that are exempt.
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Cash and savings are the most common forms of zakatable wealth. If you have money in the bank or at home, it is likely subject to Zakat.
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Shares, stocks, pensions, and cryptocurrency are zakatable if they meet certain conditions. Zakat applies to modern wealth just as it does to traditional assets.
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Property and business assets are zakatable if they are held for profit. Your main home and personal belongings are exempt.
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Debts can reduce the amount of Zakat you owe, but not all debts are treated the same way. Understanding the rules helps you calculate correctly.
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All cash and money in bank accounts is counted when calculating Zakat. This includes current accounts and savings accounts.
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Foreign currency is zakatable. Convert its value to your local currency on your Zakat date and include it in your calculation.
Understand how debts and liabilities affect your zakat calculation and what can be deducted.
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Debts can reduce the amount of Zakat you owe, but not all debts are treated the same way. Understanding the rules helps you calculate correctly.
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Zakat calculation treats short-term and long-term debts differently. Know the difference to calculate accurately.
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Long-term debts like mortgages and student loans are treated differently. You cannot deduct the full amount when calculating Zakat.
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Immediate debts are obligations you must pay within the next year. These can be deducted from your zakatable wealth.
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Student loans (in the UK) are usually not deductible because repayment depends on income and they may be written off. Scholars differ on this.
66 articles
20 Jan 2025
Mortgages are long-term debts. Scholars differ on whether you can deduct them from your zakatable wealth.
20 Jan 2025
Personal loans are deductible if they are due immediately. If the loan is being paid over time, scholars differ on how much to deduct.
20 Jan 2025
Credit card debt that is due now can be deducted from your zakatable wealth. However, future debt on the card is not deductible.
20 Jan 2025
Short-term debts that are due immediately can be deducted from your zakatable wealth. Long-term debts are treated differently by scholars.
19 Jan 2025
Many business owners make errors when calculating Zakat. Avoiding these mistakes ensures your Zakat is correct.
19 Jan 2025
If you have a side business or freelance work, Zakat is due on the cash and income you earn once it has been held for one year.
19 Jan 2025
Limited companies are separate legal entities. Shareholders pay Zakat on the zakatable portion of the company's assets, not the company itself.
19 Jan 2025
Sole traders pay Zakat on business cash, stock, and receivables. Business equipment and property are not zakatable.
19 Jan 2025
Stock and inventory in a business are zakatable. On your Zakat date, calculate the current value of all stock and pay 2.5%.
19 Jan 2025
Cash in a business bank account is zakatable. On your Zakat date, include business cash in your calculation.
19 Jan 2025
If you bought property with the intention to sell it for profit, Zakat is due on its current market value.
19 Jan 2025
Rental properties are not zakatable, but the rental income you receive is zakatable once it has been in your possession for one year.