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Zakat On Trading
Aswk. I am sole trader, where I invested and work as well. I pay 5% zakat on the income I make from it (Tax to the government once a year) . My Question is, this money I make stays in my bank, should I also add this money to my assets and pay another 2.5% on it (Which I pay on Ramadan) or only pay 5% the first year and include it in assets the following year?
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3 Replies
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Zakat On Trading
updated 2 years, 5 months ago
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Replies
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In principle, the capital that you have invested in trading is your asset and you are liable to pay Zakat on it. However, if you do trading as a business then an ijtihad can be made by you and your capital can be considered means of production, in which case there is no Zakat on it. You have to decide with utmost sincerity whether or not you consider your trading as a business or a personal venture.
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Ghamidi Sahab is of view that Retail business/Trading business is subject to Zakat on Assets (or Zakat on Wealth) and no Production Zakat will be applicable in this case.
Please see for details:
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I reverified with Ghamidi sahab and he does not consider any reason to make an ijtihad for considering the trading capital as a means of production. With that, I would like to retract my previous comment and apologize for my mistake.
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