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  • Zakat Money Given As Loan

    Posted by Amena Babar on July 5, 2022 at 7:51 am

    Can we give zakat money as loan to someone?

    I want to mention a scenario and need guidance in this matter.

    Last year in January My husband gave some money as loan to his cousin and make niyyah that once he gave the money back he will pay the zakat from this money. The cousin did not return the money up till now and we didn’t pay zakat for last year. We have paid zakat for this year though. When I asked my husband to pay zakat for the last year he said I will pay when I get the money back as I have made intention that I will pay zakat from that money.

    Can we do that as that zakat for last year is still unpaid and if we pay it now how we calculate it? Should we use current gold rate or rate of last year?

    Umer replied 1 year, 11 months ago 2 Members · 1 Reply
  • 1 Reply
  • Zakat Money Given As Loan

    Umer updated 1 year, 11 months ago 2 Members · 1 Reply
  • Umer

    Moderator July 6, 2022 at 8:26 am

    As a general principle, if loan was given to someone and later on the lender realizes that borrower is a deserving person and deserves a relief, then loan can be waived off and adjusted against Zakat Liability. But if the borrower has defaulted on a fraudulent behavior, then it will be considered as a loss and cannot be adjusted against Zakat Liability.

    If one is waiting for the loan money to be returned to pay Zakat from that money, no objection can be raised on this per se; but one needs to do a careful analysis whether that money is actually ever going to be returned or not. Zakat Amount would not be recalculated for the previous year, it will remain the same. It is in reality a Zakat Liability calculated for the last year which is still unpaid and is being carried forward.

    Please also refer to the video below from 1:09:14 to 1:10:28

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