22Different Activities

Sector Definition This sector includes activities related to the management of various types of waste (including collection, treatment, and disposal/drainage), such as industrial and domestic waste, both solid and non-solid, as well as contaminated sites. The output may be waste or sewage treatment, disposal, or use as inputs into other production processes. This sector also includes water supply activities, which are usually carried out in conjunction with sewage treatment or through units that also handle sewage treatment. This sector also includes the following businesses: ● Water collection, treatment, and delivery. ● Sewage. ● Waste collection, treatment, and disposal activities, and material recovery. ● Treatment activities and other waste management services. Zakat issues pertaining to the sector Spare Parts Spare parts that are used for the maintenance of machinery and equipment and are not intended for sale. Spare parts are non-zakatable assets deductible from the base as they are not intended for sale in their current condition, according to the Implementing Regulations. Example (28): A company operating in waste recycling has a balance of spare parts shown in the financial statements as of December 31, 2019 amounting to SAR 10,000,000. What is the amount to be deducted from the Zakat base? The balance of spare parts inventory shown in the financial statements as of 31 December 2019 is fully deductible, amounting to SAR 10,000,000, from the Zakat base, as spare parts are considered non-zakatable assets because they are not intended for sale in their current condition. The Most Important Items in the Statement of Financial Position for the Water Supply, Sewage Drainage and Waste Management and Treatment Supply Sector and Their Zakat Treatment Item Item Nature Zakat Treatment Judgment Current assets Spare parts inventory Represent spare parts used for equipment maintenance Deductible assets Deductible from the Zakat base because they are non -zakatable assets Non-current assets Water treatment plants Represent plants for treatment of water Deductible assets Deductible from the Zakat base because they are non- zakatable assets Water reservoirs Represent water reservoirs for water storage Deductible assets Deductible from the Zakat base because they are non- zakatable assets