I would like know how I should pay zakat if the house I live in has mortgage

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Ref no: 0066#

Date: Wednesday, 13th April, 2011

Category

Zakaat

Title

Question

I would like know how I should pay zakat if the house I live in has mortgage. I mean I pay mortgage every month.

Answer

Muhtaram / Muhtaramah

In the Name of Allāh, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāh wa-barakātuh.

 

Loans and other liabilities generally decrease a person’s total zakatable assets. For example, if a person earned a $50,000 surplus for the year beyond his expenses and liabilities, he will have to pay 2.5% in zakat. If a person is in debt to the amount of $10,000, he will only pay zakat upon $40,000. This is the general ruling. However, the modern long term debts do not apply in exactly the same manner. The long term debts such as home-loans etc can last between 15 – 30 years. In such a scenario, a person will only consider that year’s loan amount as a liability. He will not calculate the entire loan as a liability wherein he avoids paying zakat for 15 – 30 years. Based upon the previously mentioned example, if a person’s loan for the year reaches $15,000, he will deduct that amount from his yearly surplus earnings and pay zakat on the balance if it reaches the Nisab. He will not deduct the entire amount of the loan (i.e. $500,000) every year whereby he would avoid paying zakat for many years on end.

(Jadid Fiqhi Mabahith, vol. 6 pg. 203, Idarat al-Quran.)

And Allah knows best
Darul Iftaa

Madrasah Inaa’miyya

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