# Zakat Global > Activate for: zakat, zakatable assets, nisab, zakat calculation, institutional zakat, ZATCA zakat, zakat and ushr, sadaqah, non-Shariah income purification, charity payable Islamic, zakat on bank accounts, zakat disclosure, zakat journal entry. - Skill: `panaversity/zakat-global` (Agent Skill) - Install (CLI): `npx skillmds@latest add panaversity/zakat-global` - Raw SKILL.md: https://api.skillmd.com/api/skills/panaversity/zakat-global/raw - Safety review: pending - Works with: Claude Code, Claude.ai, OpenAI Codex - Category: Coding & Dev Tools - Author: panaversity (https://skillmd.com/u/panaversity) - Updated: 2026-09-17 - Page: https://skillmd.com/skills/panaversity/zakat-global --- ## THE GLOBAL ZAKAT LANDSCAPE Zakat is the obligatory Islamic alms payment — 2.5% of qualifying wealth above the nisab threshold, calculated on a lunar year basis (354 days). Its treatment for Islamic financial institutions varies significantly by jurisdiction. --- ## JURISDICTION SUMMARY TABLE | Jurisdiction | Mandatory? | Formula | Rate | Payer | Filing | |---|---|---|---|---|---| | Saudi Arabia | Mandatory (ZATCA) | ZATCA equity-based formula | 2.5% p.a. | IFI pays to ZATCA | Annual ZATCA return | | Pakistan | Mandatory (deduction at source) | Deduction on savings accounts | 2.5% on qualifying accounts | Bank deducts as agent | 1st Ramadan each year | | Bahrain | Voluntary (institutional) | AAOIFI GS9 / Hanafi | 2.5% p.a. | IFI may pay on behalf of shareholders | Annual disclosure | | Malaysia | Voluntary | AAOIFI GS9 / Hanafi or Shafi'i | 2.5% p.a. | IFI voluntary; disclose | Annual disclosure | | UAE | Voluntary | AAOIFI GS9 | 2.5% p.a. | IFI voluntary; disclose | Annual disclosure | | UK | Not applicable | N/A | N/A | Individual obligation only | N/A | | Nigeria | Voluntary | AAOIFI GS9 | 2.5% p.a. | Voluntary | Annual disclosure | --- ## THE NISAB THRESHOLD The nisab is the minimum wealth threshold above which zakat becomes obligatory. Two measures, take the lower (traditionally silver nisab is used for financial assets): **Gold nisab:** Equivalent of 87.48 grams of gold (at current gold price) **Silver nisab:** Equivalent of 612.36 grams of silver (at current silver price) Check the current gold/silver price to calculate the nisab in local currency. For Islamic banks with large balance sheets: the nisab is almost always exceeded. Still check and document the check annually. **Lunar year minimum balance rule:** Zakat is payable on the MINIMUM BALANCE of zakatable wealth maintained continuously throughout the lunar year — not the year-end balance. If wealth fell below nisab at any point during the year, recalculate from that point. --- ## FORMULA 1: HANAFI / AAOIFI GS9 (MOST JURISDICTIONS) **Step 1 — Identify zakatable assets:** ZAKATABLE (trade wealth and liquid assets): + Cash and near-cash + Trade receivables (murabaha receivables, DM receivables net of provisions) + Inventory / commodities held for trade + Short-term investments and sukuk classified as trading / short-term + Mudaraba and musharaka investments intended for profit + Salam receivables NOT ZAKATABLE (productive fixed assets / long-term investments): - Fixed assets (property, plant, equipment used in operations) - Ijarah assets on IFI's books (productive, not trade goods) - Long-term strategic investments - Goodwill and intangibles **Step 2 — Identify current liabilities due within the lunar year:** - Payables to suppliers - Short-term borrowings - Dividends payable - Tax payable **Step 3 — Calculate Zakat Base:** Zakat Base = Zakatable Assets - Current Liabilities **Step 4 — Apply nisab check and calculate zakat:** If Zakat Base > Nisab: Zakat = Zakat Base x 2.5% If Zakat Base <= Nisab: No zakat payable (unlikely for a bank) --- ## FORMULA 2: ZATCA (SAUDI ARABIA) Saudi Arabia's Zakat, Tax and Customs Authority uses a different formula: **Zakat Base = Share Capital + Retained Earnings + Statutory Reserves + Other Reserves - Fixed Assets - Long-term Investments - Unamortised Expenses** This is an EQUITY-BASED formula — it starts from equity, not from liquid assets. Apply the Saudi jurisdiction overlay for ZATCA-specific line-item mapping. Note: For Saudi IFIs, ZATCA zakat REPLACES income tax for Saudi-owned companies. Foreign-owned portions of the bank pay income tax; Saudi-owned portions pay zakat. Ensure correct proportional calculation if the bank has mixed Saudi/foreign ownership. --- ## FORMULA 3: PAKISTAN — ZAKAT AND USHR ORDINANCE 1980 Pakistan's Zakat and Ushr Ordinance requires banks to DEDUCT ZAKAT AT SOURCE: **From which accounts:** Savings accounts, Profit and Loss Sharing (PLS) accounts, and other qualifying deposit accounts. **When:** On the first day of Ramadan each lunar year. **Rate:** 2.5% of the account balance on that date (if balance >= nisab threshold). **Exemptions:** Account holders may claim exemption by submitting a declaration form. **The bank's role:** The bank is an AGENT (wakeel) for the Central Zakat Administration. The bank deducts zakat from each qualifying account and remits it to the Zakat Fund. **Journal entry in bank's books:** On deduction date: Dr: Depositor's Account [Zakat amount] Cr: Zakat Payable — Central Zakat Administration [Zakat amount] On remittance to Zakat Fund: Dr: Zakat Payable — Central Zakat Administration [Zakat amount] Cr: Cash / Remittance Account [Zakat amount] Note: This is NOT the IFI's own zakat — it is a DEDUCTION ON BEHALF OF depositors. Do not recognise as the IFI's expense. Merely a pass-through. --- ## NON-SHARIAH INCOME PURIFICATION (ALL JURISDICTIONS) When an IFI receives income from non-Shariah-compliant sources: Examples: penalty charges that cannot be retained, inadvertent interest income, conventional bank income during conversion, dividend from a company with >5% non-halal income. **This income CANNOT be retained by the IFI.** It must be donated to charity (sadaqah) — it is not a deductible expense for zakat purposes. **Journal entry:** Dr: Non-Shariah Income Received [Amount] Cr: Charity Payable — Purification [Amount] On payment to charity: Dr: Charity Payable — Purification [Amount] Cr: Cash [Amount] **In the income statement:** Show as a separate line "Purification / Charity Donation" NOT as operating income of the IFI. **In AAOIFI disclosures:** Mandatory disclosure of non-Shariah income amount and the charity to which it was donated, confirmed by SSB review. --- ## MANDATORY DISCLOSURES 1. Whether zakat is paid by the institution or is the individual obligation of shareholders 2. The calculation basis adopted (ZATCA / Hanafi / Shafi'i / other) — per SSB fatwa 3. Zakat base amount 4. Zakat paid (or accrued if not yet paid) 5. Non-Shariah income received and purification amount donated 6. Charity / sadaqah paid — recipient and amount For ZATCA (Saudi Arabia): zakat return filing reference number. For Pakistan: aggregate zakat deducted from depositors and remitted.