Zakat & VAT Calculator — Islamic Finance
Calculate Zakat on wealth at the correct 2.5% Sharia rate with nisab verification, and calculate VAT for any amount. Free, instant, and ad-free.
The Complete Guide to Zakat and VAT Computation in Saudi Arabia & GCC
Zakat is the third pillar of Islam and a mandatory religious levy on qualifying wealth to support designated societal beneficiaries. Its obligation requires fulfilling the Nisab threshold and ownership over a complete lunar year. Concurrently, Value Added Tax (VAT) is an indirect consumption levy administered by tax authorities such as ZATCA at the standard rate of 15% on taxable goods and supplies.
Assets Included in the Zakat Assessment Pool
- Liquid Cash & Bank Deposits: Encompasses current accounts, savings deposits, and cash in hand.
- Investment Gold, Silver & Bullion: Evaluated at real-time prevailing market spot prices per gram of pure metal.
- Commercial Inventory for Resale: Inventory destined for resale is assessed at present wholesale market liquidation value.
Frequently Asked Questions About Zakat & VAT
What is the Zakat Nisab threshold and how is it calculated?
Nisab is the minimum qualifying wealth upon which Zakat becomes mandatory after one full lunar year (Hawl). It is equivalent to 85 grams of pure 24K gold or 595 grams of pure silver. Its cash monetary equivalent is calculated by multiplying these weights by the prevailing market metal price.
What percentage of Zakat is payable on cash and business assets?
The standard Islamic rate is 2.5% of total net wealth (cash savings, investment funds, gold/silver, and inventory trade merchandise) when assessed according to the lunar Hijri calendar (or 2.577% on Gregorian financial years).
Are short-term debts deductible from the Zakat pool?
Yes, under established Islamic jurisprudence, genuine immediate liabilities and debts due for payment within the ongoing fiscal year can be deducted from gross wealth before calculating the 2.5% Zakat.
How is the 15% VAT computed in Saudi Arabia and the GCC?
To add 15% VAT to a net amount, multiply by 0.15. If an amount is already tax-inclusive and you wish to extract the pre-tax base, divide the total figure by 1.15.