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8/10/2019 zakatvstaxes-140219133811-phpapp02

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ZAKAT VS TAXES

NAME: HUDZAIFAH BIN SUHAIMI

(DBA113018)

MOHAMAD IZHAR BIN MOHD KASIM

(DBA112009)

MOHD RIDZWAN BIN MALIK (DBA112008)


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DEFINITION OF ZAKAT

In Arabic terms, zakat literally means

- Purification ( Purify ones heart of Greed)

- Growth

Zakat in Islamic finance refers to the obligationthat an individual has to donate a certain

proportion of wealth each year to charitable

causes.


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WHAT IS NISAB?

Nisab is the minimum amount of wealth that must be

owned by a muslim before he/she is obligated for zakat.

- For example, the nisab in Selangor isRM14,065.00 (according to Lembaga Zakat

Selangor).

So if youre living in Selangor and your zakatable

income is more than RM14,065.00, then you have to

pay your zakat!

In general, the nisab for zakat on wealth is equivalent

to the price of 85 grams of gold.


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WHAT IS HAUL?

Cukup Haul or Wealth must be exactly or

more than a year old

Zakatable income and wealth that is fully owned

must be in the payers possession for at least a year

- For example, Azmah has just graduated and

started her first job 5 months ago. Even if her

yearly income exceeds the nisab amount, she only

needs to start paying her Zakat on Earning afterworking for a year.

** Nisab and Haul are not applicable for Zakat Fitrah


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CONDITION OF ZAKAT PAYERS TO

BE FULFILLED

Sane

Adult (Reached puberty)

Sahib un Nisab (Owner of Wealth above Nisab

Level)Muslim


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CONDITION OF ZAKAT RECIPIENTS

Those categories of people being mentioned in the

Holy Quran, Surah al-Taubah (9:60)

Primary focuses on the poor and destitute

- Poor is defined as those people whose netasset (excluding basic necessities) is below the

Nisab threshold.

A persons poor relative should be given main

priority


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8 ASNAF OR BENEFICIARIES OF

ZAKAT

The Poor (Fuqara)

The Needy (Masakin)

The Zakat collector (Amilun)

MuallafSlaves (Riqab)

Those who are in debt (Ghanimun)

Way-farer (Ibnu Sabil)

For the cause of Allah (Fisabillilah)


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ZAKAT FITRAH

FITRThe same as Iftar, breaking a fast and it comes from

the same root word as (Futoor) which means breakfast.

DEFINITIONZakat al-Fitr is charity given to the poor at the end ofthe fasting in the Islamic holy(month of

Ramadan) .


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CLASSIFICATION

wajib(required) of every Muslim, whether male orfemale, minor or adult as long as he/she has the means

to do so.

PURPOSETo provide the poor with a means with which they can celebrate the festival

of breaking the fast (Eid al-Fitr) along with the rest of the Muslims.

1.As a levy on the fasting person.

-This is based on the hadith: The Prophet of Allah said, "The fasting of the month offasting will be hanging between earth and heavens and it will not be raised up to the

Divine Presence without paying the Zakat al-Fitr.

2.To purify those who fast from any indecent act or speech and to help the poor and

needy.


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PRODUCTION TIME

Staple was released in themonth of Ramadan, at

least before thepeople finished performing Salat

Eid( Solat Sunat Aidilfitri ) . If thedelivery time is

past duethen submitted werenot includedin the

category ofzakatalms but ordinary ( sedekahbiasa ).

BENEFITS OF PAYING ZAKAT FITRAH

1. The purpose of giving them (the poor) enough food

during Ramadan.

2.Able to meet the requirements of fasting is to

restore man to nature.


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ZAKAT ON WEALTH (HARTA)

The definition of wealth is something that can be

owned by the individual.

It is something that is paid for the trade income,

agriculture, livestock, gold, silver and income.

Zakat is paid if it has met Nisab or limit the

wealth amount that caused a Muslim has to pay

Zakat


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The wealth must suits these criteria to be obligated

for Zakat namely:

Owned in full. That is, the property is entirely owned by

a person, instead of collectively owned property.

Treasure that must be paid as Zakat must be obtained

through lawful or permitted by religion.

Property is developed or has the potential to be

developed

Has reached the limit of Nisab .

Owned more than 1 year.

*Property owners do not currently have debts that exceed

the amount of property owned.


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8 SUBSIDIARIES OF ZAKAT

Zakat on Earning

Zakat on Business

Zakat on Savings

Zakat on Gold & SilverZakat on Shares

Zakat on KWSP / EPF

Zakat on Farming

Zakat on Livestock


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ZAKAT ON EARNINGS

If you have been working for more than a year

and earning an income thats above the Nisab

amount, you are obliged to perform your Zakat

Pendapatan.

Zakat on earning is obviously calculated from

your earnings (much like your income tax).


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ZAKAT ON BUSINESS

Means performing zakat based on business

earnings. The term business refers to any types

of business like Manufacturing, mining, fishing

etc.

CONDITION OF ZAKAT ON BUSINESS

Only Muslim shares is subjected to Zakat

Compulsory for Halal Assets only

Haul-period terms


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ZAKAT ON SAVINGS

Your savings are zakatable purely because it

serves the same purpose as gold and silver (the

nisab of Zakat), and holds purchase power.


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FIXED DEPOSIT

Once a fixed deposit account reached exactly one

year (cukup haul) and this amount is more than

the nisab value, then 2.5% of the total amount

must be given as Zakat.

- For example, Maisarah (location : Selangor)

opened a fixed deposit account on April 2011.

By April 2012, her FD account has accumulated

RM5,000. In Selangor, the nisab amount for2012 is RM14,065.00. Therefore, Miasarah

doesnt need to pay zakat on her FD.


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BASIC SAVINGSIt is calculated based on the amount of the lowest balance

or the end haul each year for savings:

Savings in One Account Only

If the savings account has reached the year-old age and the

lowest balance (after subtracting the amount of interestgiven in that period) is above the nisab, then one is obliged

to pay zakat on savings for that one account.

- Example : Wati (location : Selangor) has a Maybank

account. After a year, the lowest balance she has in heraccount is RM15,500 (after substracting the interest

given by Maybank). For Selangor, the nisab amount is

RM14,065.00. Therefore, she must pay 2.5% of RM15,500

as her zakat (2.5% x RM15,500 = RM387.50).


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SAVINGS IN SEVERAL ACCOUNTSIf a person has set up several savings accounts, then

the lowest balance of all the savings accounts must becombined to calculate the zakatable wealth.

- For example, Hana (location : Selangor) has two

savings accounts, Maybank and CIMB. She hashad both accounts for one year. Lowest balance in

Maybank : RM40 (after deducting interest)

Lowest Balance in CIMB : RM600 (after

deducting interest) Total of lowest balance in

Maybank and CIMB : RM640 (does not exceed

nisab, therefore Hana does not need to pay zakat on

her savings accounts).


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ZAKAT ON GOLD AND SILVER

Possession of gold and silver that is

over the nisab amount will be

subjected to zakat. This zakat alsohas a different nisab amount.

So how to calculate the zakatamount?


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METHOD FOR CALCULATE ZAKAT

ON GOLD AND SILVER

Womens gold jewelry

The gold that the person purchase or

use as an ornament or decoration

that over the nisab, they must paythe zakat.

The nisab of this gold is about 800

grams.The formula is:

(gold weight x current price x 2.5%)


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OTHER TYPES OF GOLD

This type of gold refers to gold which is

not from the above category

It must be in form of:

- Currency-Deposits

-Mineral

The nisab amount of this type is 85grams

The calculation is:

(gold weight x Current price x 2.5%)


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SILVER

For silver, the nisab is 595grams . The

nisab value is the same regardless of its

usage or otherwise you use as the

decoration at your home. So if the silverweights more than that, you must perform

the zakat.

The calculation is:(weight of silver x price per gram x 2.5%)


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ZAKAT ON SHARE

The shares that invested in the

company must be paid in cash.

The zakat rate is 2.5% for thelowest value of shares.The share must be held by the

shareholders for one year.


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THE CALCULATION FOR ZAKAT ON

SHARE

Example 1:shares ownedat

the end of one full year. Zakat

rate is 2.5% on the lowest costand the market valueThe formula is:(unit of shares

x lowest price cost x 2.5%)


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Example 2: Shares purchases

within a year. The zakat is

calculated based on 2.5% on thevalue of shares afterdeducting

the cost of purchasing new

sharesThe formula is:(the value of

shares-the cost of purchasing

new shares)


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ZAKAT ON EPF

In Malaysia, zakat on EPF becomes

obligatory only when the EPF money

becomes fully and wholly owned by a person.

The money can withdraw when you reach 55

years or you want to purchase a house

perhaps. But when the amount reach the

nisab, so it subjected to zakat.

The formula is:Zakat value= The sum of

the withdrawn Money x 2.5%


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For example: Azman ( location-

selangor) want to purchase a house,

he withdrawn RM50,000 from EPFsaving, so after 1 year the EPF value

is above the nisab amount. The nisab

in selangor is RM14,065. So how thetotal zakat that must he pay.

Zakat value:( RM50,000 x 2.5%)

Total zakat is= RM1250


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TYPES OF WITHDRAWALS THAT IS

ZAKATABLE

Withdrawal Scheme to purchase a

house

Withdrawal Scheme to redeem

housing loan

Members children education

withdrawal scheme


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ZAKAT ON FARMING

Imposed only on staple food supplies

( these types of food must be durable

and fulfilling when eaten).

The item must be-paddy, date , corn and wheat

For example in Malaysia our staple

food is rice and therefore zakat will beimposed on rice from paddy farming.


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REQUIREMENT FOR ZAKAT ON

FARMING

Muslim

Fully owned (i.e owner of paddy

field)

Nisab ( the nisab measurement is

Ausuk or 363 bushel in Malaysia or

1360 kg of rice produced from the

farming of paddy)Staple food must be planted by

human

F i f t l


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Farming of non-staple

food like coconut, palm oil,

rubber tree, black pepper,cane, cocoa and others that

are grown for businesspurposes will be imposed

with business zakat.


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ZAKAT ON LIVESTOCK

Zakat on live stock is a type of zakat

that must be imposed owners of

these livestock such as:

-Goat, sheep, cow, buffalo and camel.But these livestock must reached the

nisab age which is 1 year and must

be in a good condition.

Ttl N b f g


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Total

number of

cow

Number of

cow for

zakat

age

30

40

60

70

1 calf

1 cow

2 calves

A cow & a

calf

1 year

2 year

1 year

1 year or 2

year


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BENEFITS OF ZAKAT

It stated in the Hadith that by giving zakat the

following benefits are derived;

Gaining the pleasure of Allah

Increase in WealthProtection from losses

Obtaining Allahs forgiveness and blessings

Protection from the wrath of Allah and from baddeath

Zakat would provide shelter at the day of Judgement

It will serve as a shield from the fires of Jahanams

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