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Nisab Application And Zakat On Salary On The Amount Above Nisab
Assalamualaikum
As per Ghamidi sb salary earned is production and zakat is applicable. Nisab for production is 642 gm silver which cost around 80k and here in India threshold limit for tax is 2.5Lacs..
So my question is if someone is earning 6 Lacs annually then what will be zakat ??
Whether it will be applicable @10% on full 6Lacs or only on salary only exceeding 80k i.e on 5.2Lacs or only on salary exceeding 2.5 Lacs i.e on 3.5Lacs -
3 Replies
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Nisab Application And Zakat On Salary On The Amount Above Nisab
updated 4 months, 3 weeks ago
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Replies
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Nisab for production is not 642 grams of Silver. Following is the correct understanding regarding Nisab:
– Nisab for production / earnings is the minimum amount below which your state exempts tax or zakat on earnings. If your state does not provide a nisab then you can use the income tax exemption as Nisab and in the absence of all these options, standard nisab of 653 kg of Dates or equivalent value can be used.
– Nisab for assets/wealth is the minimum amount below which your state exempts tax or zakat on assets. If your state does not provide a nisab then you can use the standard nisab of 642 grams of silver or equivalent value.
Since salary belongs to the domain of earning / production, therefore, in the absence of any Nisab for Zakat given by the government, Ghamidi Sahab has done ijtihad that for the time being, it is appropriate to use the income tax exemption as Nisab for the salary/production.
However, there can be difference of opinion on whether Zakat percentage should be applied on amount only above Nisab threshold or on the whole amount as soon as it crosses the Nisab threshold. Ghamidi Sahab prefers the latter approach but accepts room for a difference of opinion in this regard. Please see these responses of Ghamidi Sahab in this regard:
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Nd sir what if someone is earning 25k per month but he has some loan obligation whose EMI is 30k per month nd household exp are 10k per month meaning by he is earning 25k but expenditures are 40k still zakat will be applicable on gross receipts i.e 25k irrespective of income..
Same way if someone has business income but incurred net loss still he has to pay zakat on gross receipts rather than on net income
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As for individual debt, please refer to the following thread:
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As for business losses, two points must be kept in mind:
i) Taxes paid to the Government can be adjusted against Zakat Obligation. This includes all forms of taxes including income tax, sales tax etc.
ii) If one is still not in a position to Pay Zakat obligation because of a net loss then Zakat obligation would be waived and one should do Charity to the best of their ability.
Please also refer to the video below from 23:45 to 26:55
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