Zakat calculation is conceptually simple (2.5% of qualifying wealth above Nisab) but applying it to a real mix of assets raises practical questions. Here's a more thorough walkthrough.
Step 1: List All Zakatable Assets
Add up cash on hand, bank balances, the current market value of gold and silver you own, business inventory and money owed to you that you expect to collect, and other liquid investments or savings.
Step 2: Subtract Short-Term Debts
Debts you're currently obligated to repay can generally be deducted from your total before calculating Zakat — this typically refers to debts due for payment, not long-term obligations like a full home mortgage balance (scholarly opinions vary on the precise treatment of long-term debt, so consult a scholar if this applies to you).
Step 3: Compare to Nisab
If your net zakatable assets equal or exceed the current Nisab threshold (based on gold or silver value, which changes with market prices), Zakat becomes due on your full zakatable amount — not just the portion above Nisab.
Step 4: Calculate 2.5%
Multiply your total net zakatable assets by 0.025 (2.5%) to get your Zakat amount due.
A Worked Example
Suppose you have PKR 500,000 in savings, gold worth PKR 300,000, and PKR 50,000 owed to a friend (a debt you owe). Net zakatable assets = 500,000 + 300,000 − 50,000 = PKR 750,000. If this exceeds the current Nisab threshold, Zakat due = 750,000 × 0.025 = PKR 18,750.
Try It With Your Own Numbers
Use our Zakat Calculator to work through your own specific assets — just make sure to enter a current, accurate Nisab value.