- EN (English)
|Title:||How to pay Zakat on a 401k and children's education funds|
|Category:||Poor-due or obligatory charity (Zakaah)|
|Scholar:||Dr. Main Khalid Al-Qudah|
Assalamu alaikum wa rahmatullahi wa barakatuhu,
My dear scholars,
I have two questions:
1) I wanted to understand what formula to use to calculate zakaat on a 401k and children's education funds. Since I will not be withdrawing any money until maturity, do I still have to pay zakaat annually?
2) What amount do I have to pay at the time of maturity?
Regardless of whether or not the account holder has reached the age of maturity, Zakah must be paid on this account on an annual basis, based on the following formula:
Withdrawable amount (minus) prescribed penalty (minus) prescribed tax = the Zakatable amount.
If the account holder is still a minor, then his father or legal guardian should take care of it for him.