Zakat on Retirement, Health, and Education Accounts The governing rule for zakat on retirement accounts is this: what you can access without penalty, you pay zakat on, and what you cannot access without penalty, you do not. Access without penalty is the trigger, not the act of withdrawal. Different account types, and even different portions […]
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Zakat on Stocks and Investments: A Complete Guide for Brokerage Accounts If you own stocks in a brokerage account, you pay zakat on them, but the calculation method depends on how you engage with the market. Active traders who frequently buy and sell pay 2.5% on the total market value of their portfolio. Long-term investors
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SAFE Notes, Convertible Notes, and Startup Equity: A Shariah Assessment If you invest in startups, work in one or have founded one, you likely hold equity that exists only on paper: a SAFE note, a convertible note, stock options, or unvested shares. Before asking when zakat is due on any of these instruments, the prior
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Zakat Before Liquidity: SAFE Notes, Options, and Unvested Shares The permissibility of SAFE notes, convertible notes, and equity compensation arrangements is addressed in Part 1 of this series. This article addresses a separate question: when do these instruments become liable for zakat, and on what basis does zakat remain deferred before that point? The Condition:
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The Hawl: Passing of One Lunar Year for Zakat Liability The passing of one lunar year is an oft cited condition of Zakah. Below how do we examine what this means, what it applies to, and some of the rulings that are related to it. I. The Threshold The obligation of Zakat on productive wealth
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Zakat on Rental Property: Income, Value, and the Question of Timing The question of what zakat obligation attaches to rental property is one of the more misunderstood areas of practical zakat calculation, owing less to genuine dispute over the underlying principle than to the principle being routinely stated without the reasoning that makes it workable.
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How We Calculate Zakat on Stocks Paying zakat on stocks is one of the most common sources of confusion in contemporary zakat practice — and one of the most consequential in dollar terms. Get the method wrong and you either overpay by a factor of three or underpay by ignoring the obligation entirely. This article
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Calculating Zakat on Startup Equity: The CRI Method and the Liquidity Event Parts 1 and 2 of this series addressed the permissibility of startup equity instruments and the conditions under which zakat is deferred before a liquidity event. This article addresses two remaining questions: how to calculate the base of assets liable for zakat when
Deducting Debt from Your Zakat Calculation: What Counts and What Doesn’t You may deduct certain debts from your zakat calculation, but not all debts qualify for deduction. The key distinction is between immediate liabilities that you must pay now and long-term obligations that extend into the future. Current debts with a human creditor who can
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Zakat on Cryptocurrency: Bitcoin, Ethereum, NFTs, and Digital Assets You pay zakat on cryptocurrency you hold, whether you characterize it as currency or as a digital asset. The rate is 2.5% of the full market value on your zakat date, calculated after the asset has been in your possession for one lunar year. This applies
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