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Video: Is Zakat due upon the individual or upon the wealth? - Shaykh Bilal Ismail
Is everything I own a Zakatable asset?
Zakat is an obligatory Islamic tax – so important that it comprises one of the five mighty pillars of Islam. Zakat is an INDIVIDUAL measurement – so the onus and responsibility is on the individual to both pay it and to calculate how much he or she owes. Zakat is calculated on the amount of income a person has in hand after paying for all of their essentials during one full lunar year.
Zakat is by no means used as a tool to financially cripple Muslims, in fact, things like the home you live in, food, clothing etc. are not needed to calculate how much Zakat you owe. Zakat is merely calculated on your disposable income (when we say disposable income, we mean the income that you have left over after fulfilling the essential needs of yourself and your dependents [i.e. children / wives etc]).
When calculating Zakat, business assets must be taken into account; similarly, if you own real gold or silver jewellery and the weight of these are above the Nisab threshold Zakat must be paid on these items. If you have gold assets – use the gold Nisab. If you have mixed assets – use the silver nisab.
Not everybody has to pay Zakat; if your net assets do not equal or surpass the Nisab threshold then you are exempt from paying Zakat when it is due.