What is Zakat?
There are five core practices in Islam, which are known as the Five Pillars of Islam. The third Pillar of Islam is Zakat, where individuals must pay a set percentage of their total annual wealth to support those in need. Zakat is a charitable donation that is given to help those without the means to support themselves and distribute wealth in accordance with the wishes of Allah (SWT). After all, our goods and wealth are material possessions which do not belong to us.
Zakat is given to purify one’s income and wealth and is a good example of the altruistic attitudes of Muslim communities. The contribution made for Zakat is a set percentage of an individual’s total profitable wealth, on the condition that their total annual combined wealth surpasses the threshold known as the nisab value.
Zakat is calculated at 2.5% of an individual's total profitable wealth, including possessions, savings and precious resources. Belongings that contribute to your comfortable day to day living, such as your clothing, your home and your car, are not included. However, any additional property and car investments must be included when calculating your Zakat.