Zakah calculation : [3]

Fatawa Question

Assalaamu'alaykum Wrt Wbt. Please help by giving a simple explanation on how one should calculate Zakat of a Islamic bank where there are both Muslims and non-Muslims shareholders. The 2 volumes of books which you had translated may take a long while for me to digest and would appreciate you help by zooming in the method to calculate the Zakat. Q1) Do I calculate zakat on net profit after payment of corporate tax to inland revenue ? That is the corporate tax would be the tax on chargeable income after tax computation base on local IRAS requirement of allowable and non-allowable ? Q2) If answer to Q1 is yes, to calculate Zakat after provision for income tax, then do I take the net income after deducting the provision to compute as follows : Only applicable to Muslim shareholders : Net income after provision for income tax e.g $ X Total shareholders -5 non-Muslims and 5 Muslims = 10 shareholders Therefore, only the Muslim shareholders are subject to zakat payment -$ X * 5 / 10 * 2.5775 % (base on gregorian calendar month) = $ Y So each Muslims shareholders would have to pay $Y divide by 5 ? Q3) Besides the net profit that is Zakatable, assets less fixed assets should also be subject to payment of Zakat ? Can you explain on this as I cannot understand the AAOIFI method of net investment or net assets method. Can you use simple layman language to explain ? Q4) However, if all the above are wrong, please guide me. like what to less out or add in and the period on balance brought forward amount and current revenue etc. what about the share capital which the shareholders injected as paid up capital and its reserve in the owners' equity account - are they subject to Zakat and taking into consideration of 50 % of shareholders are non-Muslims. Thanks and best regards, Jazakallaahu

Fatwa

Click hereto view more

Publication Date

2007-05-22

Main Subjects

Economics & Business Administration
Islamic Studies

No. of Pages

2

Data Type

Fatawa

Language

English

Record ID

BIM-785917

• APA
• MLA
• AMA