The Shari'ah does not require the payment, of Zakah, however, on just any amount of wealth that is capable of growth, regardless of how little. Instead, it stipulates that the wealth must exceed a certain minimum, known as a Nisab. There are several ahadith from the Prophet (sallaallaahu alayhiwa sallam) in which minimums are delineated for different groups of assets. For example, Ali ibn Abi Talib (RA) narrated that the Prophet (sallaallaahu alayhi wa sallam) said: "When you possess two hundred dirhams and one year passes on them, five dirhams are payable. Nothing is incumbent on you, that is on gold, till it reaches twenty dinars. When you possess twenty dinars and one year passes on them, half a dinar is payable. Whatever exceeds. that will be reckoned properly." [Then, the narrator said: 'I do not remember whether the words "that will be reckoned properly" were uttered by Ali himself or he attributed them to the Rasul (sallaallaahu alayhi wasallam).] "No zakah is payable on property till a year passes on it." (Abu Dawud)
How much is Nisaab ul-Zakaah for Cash?
Allaah says concerning zakah on gold and silver: “…As for those who hoard treasures of gold and silver and do not spend them for the sake of Allah--warn them of grievous suffering [in the life to come]" (Q9[at-Tawbah]:34) Thus, zakah is prescribed for gold and
silver--whether they are in the form of coins, ingots, or dust - as long as the amount owned constitutes a Nisab, a period of a year has passed, debts are settled, and/or basic needs satisfied from it. Our concern this month is to establish the basic Shari'ah principles concerning the Nisab. In the next edition, we shall see what the Nisab is in various currencies. The minimum of Nisab for gold is twenty dinars owned for one year. Its due is a quarter of a tenth [2.5%], that is, half a Dinar. For any amount over twenty dinars, a quarter of a tenth [2.5%] is levied upon it. 'Ali reported that: the Prophet (sallaallaahu alayhi wa sallam) said: "There is nothing upon you in gold until it reaches twenty dinars. Thus, if you have twenty dinars at the end of the year, then there is half a dinar levied on it [as zakah}. Any additional amount will be calculated in this manner. There is no zakah on property until it has been owned for one year." (Ahmad and it is graded authentic by Bukhari)
The Nisaab ul-Zakaah for gold and silver
Nisaab ul-Zakat for Naqd (gold and silver) is defined as the minimum amount of Naqd specified by Shari'ah below which one is not required to pay zakah, whereas if one's wealth exceeds it then zakah becomes incumbent. And it is known that zakat ul-Maal (wealth) in Shari'ah is required for the two types of Naqd -gold and silver - and what serves their function in modern times (commonly referred to as cash), whether it is naira, dollars, riyals, pounds or otherwise. Nisaab for gold as our Prophet (sallaallaahu alayhi wa sallam) has informed us (and for currencies made from gold) is 20 Mithqaalan [Dinar], a measure which is equivalent to 85 grams of pure gold (1 Mithqaal = 4.25 grams). It becomes incumbent upon anyone who owns such an amount in any form to pay zakat on it in the amount of 2.5%. Nisaab for silver and currencies made from silver is 200dirhams, which is equivalent to 595 grams of pure silver (1 dirham = 2.975 grams). Likewise, it becomes incumbent upon anyone who owns such an amount in any form to pay zakat on it in the amount of 2.5%.
It is well known that there is a noticeable disparity between the value of Nisaab for gold and that of silver in our times, with that of silver being lower as we shall show next month, inshaa Allaah. The best and most conservative for a person of piety is to assess how much currency he has that has been in his possession for a complete lunar year (Hijri, which is 354 days). If the amount reaches the value of Nisaab for silver or more, then he should pay 2.5%of it as Zakah for the prescribed beneficiaries as specified by Shari'ah.
This article was culled from the publications of Deen Communication Limited