How to calculate zakat while in debt?
Calculating zakat while in debt involves understanding how debts affect one's net wealth. According to the teachings of Islamic jurisprudence, zakat is due on the wealth one possesses after subtracting any debts owed.
In Al-Kafi, it is narrated: There is no zakat on debt unless the owner of the debt is the one who delays its payment. If he is unable to collect it, then there is no zakat upon him until he actually receives it.
Al-Kafi 5:90 This indicates that if you are unable to collect a debt you are owed, you do not have to pay zakat on that debt until it is received.
Furthermore, another narration states: I asked him about a man whose half of his wealth is tangible and the other half is debt, is zakat obligatory on him? He said: He purifies the tangible part and leaves the debt.
Al-Kafi 5:106 This suggests that if a person has both tangible assets and debts, they should only pay zakat on the tangible portion of their wealth, while the debts do not count toward zakat calculations until they are settled.
Thus, when calculating zakat, one should first determine the total wealth, subtract any debts that are due, and then calculate zakat on the remaining amount, focusing on the tangible assets.
Sources
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Al-Kafi 5:90
Al-Kafi · Book 5, Hadith 90
There is no zakat on debt unless the owner of the debt is the one who delays its payment. If he is unable to collect it, then there is no zakat upon him until he actually receives it. — OR — It is not permitted to pray behind someone who seeks reward for the call to prayer and prayer, and his testimony is not accepted.
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Al-Kafi 5:106
Al-Kafi · Book 5, Hadith 106
I asked him about a man whose half of his wealth is tangible and the other half is debt, is zakat obligatory on him? He said: He purifies the tangible part and leaves the debt. I asked: If the debtor repays after six months? He said: He purifies it then. I asked: If the full year has passed on one half and six months on the other half? He said: He purifies the part on which a full year has passed and leaves the remainder until its year completes. I said: If he wishes to purify it earlier? He said: How good that is. — OR — I asked about accepting the testimony of the people of religion over a man who is not of their religion. He said: No, except if no others are found. If none other than them are available, their testimony is accepted regarding a will, because it is not correct for the right of any Muslim person to be lost, nor does it invalidate his testament.
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