How to Calculate Zakat

Zakat is one of the five pillars of Islam — a yearly payment of 2.5% of net zakatable wealth, due once your wealth has been at or above the nisab threshold for one lunar year (hawl). This guide explains the calculation in plain English, with a worked GBP example.

What Zakat is

Zakat is an annual obligation on net wealth above a minimum threshold. It is generally paid at 2.5% on cash, savings, gold, silver, business stock and similar assets — not on income.

What nisab means

Nisab is the minimum amount of wealth (above basic needs and short-term liabilities) you must hold for one lunar year before Zakat becomes payable. It is benchmarked against:

• Silver nisab: the value of 612.36g of silver
• Gold nisab: the value of 87.48g of gold

The GBP value of nisab changes daily because metal prices change. Different organisations may publish slightly different values depending on the price source and method.

Silver vs gold nisab

Silver nisab is a lower threshold in GBP, so it is the more inclusive option — many people use it because it makes Zakat payable for a wider group, which is often viewed as preferable. Gold nisab is a higher threshold. Different scholars and organisations may recommend different standards.

What hawl means

Hawl is one lunar year (approximately 354 days). Zakat is due once your wealth has stayed at or above the nisab threshold for one complete lunar year.

Step by step calculation process

1. Add up your zakatable assets (cash, savings, gold, silver, shares, crypto, business stock).
2. Add up your short-term qualifying liabilities (debts due within 12 months, overdue bills).
3. Net zakatable wealth = total assets − qualifying liabilities.
4. Compare to nisab. If net wealth is at or above the threshold (and hawl has passed), Zakat is due.
5. Multiply net wealth by 2.5% (one fortieth) to get the Zakat amount.

Worked GBP example

A user has the following:

• Cash in bank: £8,000
• Gold (current value): £1,500
• Shares: £500
• Total assets: £10,000

Liabilities:

• Overdue bills: £200
• Total qualifying liabilities: £200

Net zakatable wealth = £10,000 − £200 = £9,800. Using silver nisab (indicative April 2026: ~£520), £9,800 is well above the threshold. Zakat = £9,800 × 2.5% = £245.

What counts as zakatable assets

• Cash — including cash at home and physical currency
• Bank savings — current accounts, savings accounts, ISAs, premium bonds
• Gold — at current market value
• Silver — at current market value
• Money owed to you — only amounts you realistically expect to receive
• Shares and investments — treatment varies by intention; many treat at current market value
• Cryptocurrency — many contemporary scholars treat as zakatable at current GBP value
• Business stock — goods held for resale, valued at expected selling price

What liabilities may be deductible

Only short-term qualifying liabilities are typically deducted:

• Debts due within the next 12 months
• Overdue bills, tax, rent and utilities
• Other amounts due now

Long-term debts like mortgages and multi-year loans are usually not deducted in full. A common approach is to deduct only this year's payments, or to ignore long-term debt entirely for Zakat purposes.

Complex cases and why they vary

• Pensions — treatment depends on the pension type, your access to it, and scholarly view. Some defined-contribution pensions may be partly zakatable; defined-benefit pensions are often treated differently.
• Property — your primary residence is generally not zakatable. Investment property bought to resell may be zakatable on the resale value; rental property is more nuanced.
• Mixed-intent investments — shares held for long-term investment may be treated differently from shares held for short-term trading.
• Business machinery and fixed assets — generally not zakatable; business stock for resale is.

FAQ

What is nisab? The minimum threshold of wealth — benchmarked to 87.48g of gold or 612.36g of silver — that triggers Zakat liability.

Is Zakat 2.5%? Yes, on personal wealth such as cash, savings, gold, silver and business stock.

When is Zakat due? Once your wealth has stayed at or above nisab for one lunar year (hawl).

Do I pay Zakat on income? No — Zakat is on net wealth, not income.

Sources

• National Zakat Foundation — https://www.nzf.org.uk/calculate-zakat/
• Islamic Relief UK — https://www.islamic-relief.org.uk/giving/zakat/zakat-calculator/

Last reviewed: April 2026. This guide is educational and is not a fatwa. For complex cases, check trusted scholarly guidance.

Try the calculator

Use our Zakat Calculator to estimate your Zakat in GBP using either silver or gold nisab.