What is Zakat?
The term Zakat means alms, but the actual meaning of Zakat is purification and growth, thus encouraging growth and equality amongst the population and community whilst sharing one's wealth with his fellow beings. It is an obligation upon all sane, adult Muslims whose total annual wealth meets or exceeds the nisab value, and it forms one of the central Five Pillars of Islam.
By giving a fixed percentage of your overall wealth each year to support those in need, you will be fulfilling the wishes of Allah (SWT) and completing a key component of your faith.
Giving Zakat on an annual basis is seen as an important religious duty in Islam. It becomes obligatory upon an individual when a certain amount of maintained money or wealth is reached and exceeded. If the individual’s amount of profitable wealth falls below the nisab value, then that individual is not liable to pay Zakat in that given lunar year*. If the amount of personal, profitable wealth meets or exceeds the nisab value, then the individual must pay 2.5% of the total amount above the nisab value as Zakat in that lunar year.
* Based on the lunar cycle, an Islamic calendar year is 355 days on average.
‘As-Sadaqat (Zakat) are only for the Fuqara' (poor), and Al-Masakin (the needy) and those employed to collect (Zakat funds); and for to attract the hearts of those who have been inclined (towards Islam); and to free the captives; and for those in debt; and for Allah's Cause (i.e. for Mujahidun - those fighting in the holy wars), and for the wayfarer (a traveller who is cut off from everything); a duty imposed by Allah. And Allah is All-Knowing, All-Wise.’
- Holy Qur’an (9:60)