Guidelines

Zakat on Salaries Salaries are customarily paid in cash money; therefore, they are subject to Zakat on banknotes. If the remainder of the salary reaches the quorum on its own or by inclusion into another money, such as the cash existing in his bank balance, or by adding trade offers to it if he is a merchant, Zakat is due in the amount of a quarter of tenth (2.5%). For example: If an employee receives the salary of Muharram, at the amount reaching the quorum, and remains with him until Muharram of the following year, then Zakat must be paid on this salary, and thus the salary of each month is calculated according to its own hawl. However, this may prove difficult for the Zakat payer, because the salaries are paid every month, and because his expenses differ every month, so he cannot confirm how much is remaining. Therefore, a Zakat payer may establish a day each year to pay Zakat on all the wealth he owns, when a lunar year passes over the first quorum he owns. On such date, Zakat must be paid for the money on which a full year has passed and also advance Zakat for the wealth not passing a hawl. This manner is easy for the payer and helps the poor. 3.4 Zakat on debts There are two types of debts: First: Debts owed to zakat payer by third party Debt owed to zakat payer by third party is divided into two types: A. The third party is able to pay the debt and is not procrastinator. So, whenever the zakat payer requests the debtor to pay the debt, he pays it. Thus, the zakat payer (creditor) shall pay the zakat on this debt at the end of each year as it is like the money in his hands. For example, if he has ten thousand riyals in cash and a debit of two thousand riyals is owed to him by the debtor, and the debtor is able to pay the debit without procrastination, the zakat payer shall pay zakat for the amount of twelve thousand riyals. B. The third party (debtor) is unable to pay the debit or he is able to pay the debit but he is procrastinator and does not pay. The zakat payer thinks that he will not get his debit back. In this case, zakat is not obligatory. It shall be obligatory only if he receives it and one year passes after receiving it. So, he shall pay zakat for only one year. For example, if he has ten thousand riyals in cash and a debit of two thousand riyals is owed to him by the debtor. The zakat payer thinks that he will not get these two thousand riyals. So, he will pay zakat for the amount of ten thousand riyals only. If the debtor pays the debit after three years, for instance, the zakat payer shall pay zakat only if he receives the debit and one year passes after receiving it. Second: Debts owed to third party on zakat payer The zakat payer shall not deduct the debts he has to pay from his zakat. He shall pay his zakat in full as if he has no debts. For example, if he has ten thousand riyals in cash, and he owes a debt of two thousand riyals, he must pay zakat for the ten thousand riyals in full and shall not deduct two thousand from it.7