When is Zakat due? A simple individual guide

Zakat is due on a Muslim who owns a threshold (nisab) — a minimum amount of wealth — after a full lunar year (hawl) has passed over the money. The nisab is valued by the price of gold or silver at the time of payment.

Zakat is not computed on total assets alone, but on the net zakatable wealth: cash, gold and silver held for trade, stock in trade, business profits, and even due financial rights.

Zakat is paid at 2.5% of cash and the value of commercial goods, and is distributed to the eight prescribed categories, most importantly the poor and needy.

It is wise to consult a Zakat specialist for detailed rulings, especially with complex investments and financial derivatives, to ensure an accurate and valid calculation.