Zakatable Assets

Wealth that is subject to zakat once it exceeds the nisab and has been held for a lunar year. The core categories are cash and bank balances, gold and silver, trade inventory and goods held for sale, collectible receivables, and investments held for growth or income.

Assets used for personal needs (your home, car, furniture, clothing) and productive assets used to earn income (business equipment, rental property itself) are not zakatable, though income from them becomes cash that is. Modern questions concern retirement accounts, stocks, cryptocurrency, and jewelry, where scholarly positions differ.

The single most common zakat error is paying on the wrong base, in both directions: counting a home or a business van (not zakatable) or omitting a brokerage account or gold bangles (zakatable under some views). The organizing principle from classical fiqh is growth: zakat falls on wealth that is money or is held to become money, and not on things held for use. From that, the modern table follows.

Zakatable: cash in every account and currency; gold and silver bullion; jewelry under the Hanafi view (exempt if for personal use under Shafi'i, Maliki, and Hanbali views); stocks, ETFs, mutual funds, and crypto held as investments; trade inventory at sale price; receivables you expect to collect; the vested, accessible balance of retirement accounts under the majority contemporary view (with alternative positions for inaccessible or penalized funds); and loans you have made to others that you expect to be repaid. Not zakatable: your residence and personal vehicles, household goods, business equipment and premises, rental real estate itself, and intangible personal items. Deductible: debts due within the coming year under most scholars, and some deduct only the current year's installments on long-term debts like a halal mortgage.

For U.S. tax purposes zakat paid to a qualified 501(c)(3) is deductible as a charitable contribution if you itemize, though zakat given directly to individuals is not. The HalalWallet calculator walks each category with the position choices spelled out.