Page 10 - Obligatory Zakat Made Easy

Business Zakat Postulate

Allah (SWT) said:
[Owner's equity+ Long-term liability - Fixed asset -
"By men whom neither traffic nor merchandise can divert Semi-fixed asset] x % of Muslim ownership x 2.5%
from the Remembrance of Allah nor from regular Prayer,
nor from the practice of regular Charity: their (only) fear is Note
for the Day when hearts and eyes will be transformed." Real accounting examples cannot be presented because they are
An-Nur: Verse 37 complicated. Calculation is based on the following principles:-
• Fund structure
Prophet Muhammad (PBUH) said: • No classification of current assets and current liabilities
• Determination of share ownership
"ft is not accumulated on scattered property and is not Suitable for Islamic financial and banking institutions,
scattered on accumulated property with the intention to takaful and public limited companies which do not classify
avoid charity (zakat for the payer) or reduce the collection current assets and current liabilities.
(for amil) and everything between two persons who share,
that both must return them equally (based on the ratio)".
Narrated by Bukhari No Specific Account

Calculation Method Calculation Example
Nett profit (C) x 2.5%
Method 1 - Working Capital
[Current Assets - Current Liabilities CNote 3J J x Percentage of A Annual revenue/ sales/ earnings RM6,000.00 x 12 Bulan
Muslim Ownership x 2.5% RM72,000.00
= RMS,800,000.00 - RMS,400,000.00 x 100% X 2.5% B Less: Annual expenses/ cost (RM10,000 00)
= RM400,000.00 x 100% x 2.5% C Annual net profit (A-B) (Note4) RM62,000.00
= RM10,000.00 D Multiply: Rate of zakat 2.5%
Note 3: Current assets & current liabilities must be adjusted first. E Annual zakat (C x D) RMl,550.00

Note 4: Amount has reached nisab.
Suitable for public limited and private limited,
co-operative, trading, enterprise and other companies Suitable for small businesses such as night bazaar, farmers'
where there is a classification of current assets and current markets, restaurants and the like.
liabilities.

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