Zakah on Gold and Silver


Zakah on gold and silver

Zakah on Gold and Silver

The ruling on Zakah of Gold and silver are also applied to its derivatives such as money, jewels and ingots. The Gold kept or invested and is in the form of gold bars is obliged for zakah, if the weight of the gold reached the haul and nisab. If the gold jewellery is kept without the intention of using it is also obliged for zakah.  The legality of zakah on gold and silver can be seen through the following Quranic verses and Hadith. Allah says in Glorious Quran:

“O you who believe, many of the rabbis and the monks do eat up the wealth of the people by false means and prevent (them) from the way of Allah. As for those who accumulate gold and silver and do not spend it in the way of Allah, give them the ‘good’ news of a painful punishment…” (9:34)

In the above verse, there is a tough warning of a painful punishment to those Muslims who refuse to offer zakah on gold and silver. The Prophet (saw) said:

Abu Huraira reported Allah’s Messenger (may peace be upon him) as saying: If any owner of gold or silver does not pay what is due on him when the Day of Resurrection would come, plates of fire would be beaten out for him; these would then be heated in the fire of Hell and his sides, his forehead and his back would be cauterized with them.

(Sahih Muslim, Book 5, Hadith 2161)

Zakah on women’s gold and silver jewellery

The gold and silver jewellery also comes under the general ruling of gold and silver. If the weight of gold and silver jewellery reaches the Nisab and it is in possession for a period of one year, Zakah should be offered on it. There is a difference in view between the scholars relating to zakah on gold and silver jewellery that is kept for adornment and not sold for business purposes. One opinion is that it is obligatory because Allah(swt) says in the Glorious Quran:

“As for those who accumulate gold and silver and do not spend it in the way of Allah, give them the ‘good’ news of a painful punishment,” (9:34)

This above verse covers every form of gold and silver, jewellery and so forth. The Hadith mentioned previously (Sahih Muslim, Book 5, Hadeeth No 2161), also covers all forms of gold and silver. Once, the prophet (saw) saw gold bangles on the hand of a woman and he said:

“Do you offer the Zakaah for this?” She replied, “No.” He said, “Are you pleased that Allah (swt) encloses you with two bangles of fire on the Day of Judgment?” So she threw them and said, “They are for Allah(swt) and His Messenger(saw)”(Abu Dawood and An Nasaa’ I with a Hasan chain of narration)

It has been authentically reported of Umm Salamah (ra) that she wore some gold jewellery, and so she said:

“O Messenger of Allah(saw)! Is this regarded as hoarded wealth(al Kanz)? He replied, “Whatever had reached the amount liable for Zakah, and then Zakah is paid upon it, it is not regarded as hoarded wealth (al Kanz).”(Aboo Dawood and Ad-Daraqutni, Al Hakeem graded it as Sahih)

Nisab for zakah on gold and silver

The nisab of gold is twenty Dinars or 85grams and the nisab of silver is two hundred dirham or 595 grams. So, Zakaah is to be offered on gold when it reaches 85 grams and the Zakah is to be offered on silver when it reaches 595 grams. This practice is proven through the following Hadith:

The prophet(saw) said: “When you possess two hundred dirhams (silver) and a year passes by, you are to pay five dirhams (as Zakah). There is nothing for you to pay of gold until it is twenty dinars. When you possess twenty dinars and a year passes by, you are to pay half of a dinar; any increment is to be calculated accordingly.” [ Source: Abu-Dawud]

The appropriate amount of Zakah in gold and silver is 2.5%.  This is based on the prophetic Hadith:

“Ibn ‘Umar and ‘Aishah narrated that: that from every twenty Dinar or more. The Prophet used to take half a Dinar and from forty Dinar, one Dinar.” (Sunan Ibn Majah Book 8 Hadith 1791)