1. Articles that are for sale are referred to as merchandise. The nisāb for zakāt on merchandise is the same as that for cash, i.e. if the value of the articles is at least equivalent to the value of 87.48 grams of gold or 612.36 grams of silver (whichever is less), and it is be obligatory to pay zakāt at the rate of 2.5% or one fortieth.

2. Zakāt is Fard (obligatory) on the following items when calculating a balance sheet:

a. Stock in trade

b. Goods in transit (which have been paid for)

c. Cash on hand

d. Outstanding cash and loans (when repaid and if they are equal to nisāb)

e. Cash at bank

f. Savings account

g. Fixed deposits

h. Misc. income outstanding (when repaid and if they are equal to nisāb )

i. Claims (acknowledged)

j. Other savings

3. All these must be added as one amount and after subtracting the creditor’s amount and/or any other liabilities, the balance must be added to the capital. zakāt must then be given on this combined figure.

4. Zakāt should be given on the capital that exists on the hawl date, which includes the profit, e. g. at the beginning of the year the capital is $20,000. When the year ends a profit of $5,000 is shown. Zakāt must be given on $25,000.

5. If a bad debt is recovered and it is equal to or exceeds the nisāb, then zakāt on all the past years must be given.

6. If one has various different types of merchandise then the total value of all the goods should be calculated. If it is equal to or exceeds the value of nisāb then it will be necessary to give zakāt.

7. If at the beginning of the year one has the full nisāb and during and year the amount decreases and by the end of the year possession of the full nisāb is regained then it will be necessary to give zakāt on this amount regardless of fluctuations in the interim.

8. If one mixes halāl and harām merchandise and the amount is equal to or exceeds the nisāb at the end of the year, it will be necessary to give zakāt.

9. It is necessary to calculate the price of merchandise at the current wholesale price. zakāt should be calculated on these figures.

10. If a few persons are partners in a company and if any one share of the partners is equal to or exceeds nisāb, it will be necessary for that partner to give zakāt.

11. Zakāt on stocks must be calculated on the hawl date.

12. Zakāt is due at the current price on shares held in a company at the end of every hawl.

13. As machinery, land, fixtures and fittings, furniture, buildings etc. are exempt from zakāt; one is allowed to subtract these from the total assets. This could be obtained from the company's annual report. For example if one has shares worth $10,000 and the machinery, land, etc., are worth 5% of the total assets of the company, then deduct $500 for machinery, land, fixtures and fittings, furniture and buildings (the zakāt-exempted items) thereafter deduct the liabilities of the company proportionately to the percentage of shares held, and the zakāt must be calculated on the balance.

14. When zakāt is given on a capital amount once, and thereafter if this same amount remains with the owner until the following year then zakāt will be due again. Zakāt will be due repeatedly after every hawl has elapsed.

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Prepared by Darul Ifta, Shariah Board, New York