- EN (English)
| Fatwa ID: | 23456 |
| Title: | Paying zakat on stocks |
| Category: | Poor-due or obligatory charity (Zakaah) |
| Scholar: | Dr. Main Khalid Al-Qudah |
| Date: | 08/05/2008 |
Assalamu alaikum,
I understand that if a person is custodian over another's wealth (i.e., a minor), they would be obliged to pay zakat on that wealth, on behalf of its owner. I have stock that has been under custodianship of my mother until just recently and I have been Muslim for almost six years, al-hamdulillah. My mother is not Muslim and therefore never paid zakat on the stocks for me. Do I need to pay zakat for the past six years that I was a Muslim but did not pay it? If so, do I go by the current worth of the stock? As for this year, do I just calculate the value of my stocks and then pay whatever 2.5% of that would be? This is the only wealth I have, so I will have to sell some stock in order to pay the zakat, right?
Jazakum Allah khairan.
Since you have been in possession of those stocks for a long period of time (meaning that you - and your mother before you - did not invest for the purpose of speculating (buying and selling) in stocks, but rather, you own them as exploited assets), Zakah would only be due on the accrued profit, not on the whole sale market value.
Therefore, you must figure out - through your broker - exactly how much profit has been generated over the past six years, and pay its due Zakah, based on the rate of 2.5%.
If it is difficult for you to pay the full amount all at once, you could come up with a long-term payment plan that would be convenient for you, so that you wouldn't have to sell some of the stock in order to pay your Zakah.
