Zakat

Zakat is one of the Five Pillars of Islam, and it is not charity; rather, it is obligatory for Muslims to give Zakat when their wealth meets the necessary criteria every lunar year.

The purpose of Zakat is ultimately to increase faith and devotion to Allah. It also acts as a social safety net for those in need and a means to uplift the entire community and help Muslims and Islam thrive. Zakat is a pillar of Islam and as such it works together with the other four pillars as a way of upholding and strengthening the religion. 

By giving Zakat Muslims cleanse their own wealth. Zakat helps to keep the economy flowing by freeing people from burdens and giving them the chance to reach their potential. 

Zakat, when it works properly, should have a long-term impact for the state of the whole Muslim community. 

According to the Hanafi school of thought, Zakat is obligatory for every adult, mentally sound Muslim who possesses a Zakatable asset exceeding the threshold (nisab). Meanwhile, the Shafi'i, Maliki, and Hanbali schools hold the view that Zakat is also obligatory on children and the mentally incapacitated if their wealth reaches the nisab threshold.

The percentage for Zakat depends on the type of Zakatable asset: Personal and Business inventory require 2.5% or 1 portion of 40. For Plantation and farm products, the Zakat rate ranges from 7.7% to 10%, while for Treasure, it is set at 20%.

It is recommended to use the Lunar (Islamic Hijri) calendar when calculating Zakat. Using the Lunar calendar you pay 2.5% in Zakat however it is still permissible to use the Gregorian calendar. In this case though, you will need to pay 2.577% Zakat. It is recommended to stick to the Lunar calendar to avoid miscalculating your Zakat.

Here is an example-
If your Zakat anniversary is on the 1st of Ramadan, last year that would have meant your Zakat anniversary was on the 23rd of March 2023. The year before that it would have meant your Zakat anniversary date was on the 2nd of April 2022. So if you had stuck to the Gregorian calendar, you would have missed your actual Zakat anniversary by 10 days. If you are married and your spouse normally expects you to mark your wedding anniversary, imagine how they would feel if you remembered not just one day later but almost two weeks later.

There’s no obligation to give Zakat during Ramadan, though many people choose to make the most of the blessed month by giving Zakat. 

The giving of Zakat during Ramadan is encouraged in the Sunnah, but Zakat should be given in advance and then correctly calculated on your Zakat anniversary. Delaying Zakat and then giving it in arrears during Ramadan is discouraged.

Zakat al-Mal (commonly called 'Zakat') is one of the five pillars in Islam, an obligation ordained by our Creator. It is due when a Muslims wealth reaches the nisab (threshold) amount. It is paid annually on their Zakat anniversary.

Zakat al-Fitr is given by the head of the household for each member of the family, before the Eid al-Fitr prayer. All Muslims must give Zakat al-Fitr regardless of their age or financial status, unless they themselves do not have the means to do so, Hence, they could be eligible to receive Zakat al-Fitr or Zakat themselves. 

Sadaqah is voluntary donations, and there is no limit on how much you can give pay or when you

Yes, NZF has Deductible Gift Recipient (DGR) status, which means all donations over $2 are fully tax-deductible. A common question that arises is whether it is permissible in Islam to claim donations as tax deductions. The answer is yes.

Stripe charges us 1.4% of your donation + A$0.30 for domestic cards. For e.g. if you donated $5 as Zakat, we receive $4.63. You have the option to pay the additional transaction fee on top of the donation amount or opt out, so we take the transaction fee out of your donation.

Missed Zakat is a common issue with various causes. Some people intentionally miss it, others forget, and many miscalculate the amount. Catching up on missed Zakat can seem like a daunting task, but it’s important to get it right. If you think you may have missed Zakat to catch up on, you needn't go through it alone. Here are some ways NZF can help:

• If you suspect miscalculation or missed payments in the past, or if you are unsure and want to be on the safe side, check our Missed Zakat Guide.
• Learn more – our resource centre is packed with information and answers to some of the most common Zakat questions: https://www.nzf.org.au/guides/.
• Need a bit more help? Why not set up a one-to-one consultation with a Zakat Specialist? Zakat Hotline: 0449 004 663.