Zakat al-Mal

The obligatory annual charity on accumulated wealth, as distinct from Zakat al-Fitr (the per-person Ramadan payment). It is due at 2.5% on zakatable assets (cash, gold and silver, trade inventory, receivables, and most investments) that have been owned for one lunar year (hawl) and exceed the minimum threshold (nisab).

Agricultural produce and livestock have separate rates. Zakat al-Mal is one of the five pillars, paid once a year on a fixed personal zakat date, and distributed to the eight categories of recipients named in Qur'an 9:60.

Zakat al-Mal is the zakat most people mean when they say zakat, and the practical difficulty for U.S. Muslims is not the rate but the base. The classical categories map onto modern holdings as follows. Cash: everything in checking, savings, money market, and cash-equivalent accounts, in any currency, including money held abroad. Gold and silver: jewelry is zakatable under the Hanafi school and exempt if worn under the majority view, so pick a position with your scholar.

Trade goods: business inventory at sale value, plus receivables you expect to collect, minus payables due. Investments: shares held for trading are zakatable at market value; shares held long term are zakatable either at market value (the simpler contemporary view) or on the company's zakatable assets per share (the proportional view, roughly 25 to 30% of market value for most operating companies). Retirement accounts: positions range from the full accessible balance to only withdrawn amounts, and the calculator lets you choose. Real estate: your home is exempt; rental property is exempt but its net rent is cash; property held to flip is trade goods.

Debts you owe that are due within the year are deducted by most scholars. Set one zakat date, usually in Ramadan, value everything on that date, and pay 2.5% of the net if it exceeds the nisab; the HalalWallet calculator applies the positions you choose and shows the cited source for each.