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Zakat on Gold and Silver: Complete Calculation Guide

Published: January 10, 2024•10 min read•Islamic Finance Team

Gold and silver have been traditional stores of wealth throughout Islamic history. This comprehensive guide will help you understand how to calculate Zakat on your precious metal assets, including jewelry, coins, and investments.

Nisab for Gold and Silver

Before calculating Zakat, you must determine if your precious metals meet the Nisab threshold:

Gold Nisab

87.48 grams

Equivalent to 20 Islamic Dinars. If you own 87.48g or more of pure gold, Zakat is obligatory.

Silver Nisab

612.36 grams

Equivalent to 200 Islamic Dirhams. If you own 612.36g or more of silver, Zakat is obligatory.

Understanding Gold Purity (Karat System)

Most gold jewelry is not pure gold but an alloy. The karat system indicates purity:

  • 24 karat: Pure gold (100%)
  • 22 karat: 91.67% pure gold
  • 21 karat: 87.5% pure gold
  • 18 karat: 75% pure gold
  • 14 karat: 58.33% pure gold
  • 10 karat: 41.67% pure gold

Purity Calculation Formula

Pure Gold Weight = (Total Weight × Karat) ÷ 24

Step-by-Step Calculation Process

For Gold

  1. Weigh your gold: Get the total weight in grams
  2. Determine purity: Check the karat marking
  3. Calculate pure gold: (Weight × Karat) ÷ 24
  4. Check Nisab: Is pure gold ≥ 87.48g?
  5. Calculate Zakat: Pure gold weight × current gold price × 2.5%

For Silver

  1. Weigh your silver: Get the total weight in grams
  2. Check purity: Most silver jewelry is 92.5% pure (sterling silver)
  3. Calculate pure silver: Weight × purity percentage
  4. Check Nisab: Is pure silver ≥ 612.36g?
  5. Calculate Zakat: Pure silver weight × current silver price × 2.5%

Practical Examples

Example 1: Gold Jewelry

Scenario: Fatima owns 120 grams of 22-karat gold jewelry

Pure gold calculation: (120 × 22) ÷ 24 = 110 grams

Nisab check: 110g > 87.48g ✓ (Zakat is due)

Current gold price: $65 per gram

Zakat calculation: 110 × $65 × 2.5% = $178.75

Zakat due: $178.75

Example 2: Silver Collection

Scenario: Ahmed owns 800 grams of sterling silver (92.5% pure)

Pure silver calculation: 800 × 0.925 = 740 grams

Nisab check: 740g > 612.36g ✓ (Zakat is due)

Current silver price: $0.85 per gram

Zakat calculation: 740 × $0.85 × 2.5% = $15.73

Zakat due: $15.73

Example 3: Below Nisab

Scenario: Sara owns 60 grams of 18-karat gold

Pure gold calculation: (60 × 18) ÷ 24 = 45 grams

Nisab check: 45g < 87.48g ✗ (Below threshold)

No Zakat due - below Nisab

Special Considerations

Mixed Metals

If you own both gold and silver, calculate Zakat separately for each metal. You cannot combine them to reach the Nisab threshold.

Jewelry for Personal Use

There are different scholarly opinions on jewelry worn for personal adornment:

  • Majority view: All gold and silver is subject to Zakat, including jewelry
  • Alternative view: Jewelry for personal use is exempt if within reasonable limits
  • Recommendation: Consult with local Islamic scholars for guidance

Investment vs. Personal Use

Gold and silver held as investments are definitely subject to Zakat. This includes:

  • Gold and silver coins
  • Bullion and bars
  • ETFs backed by physical metals
  • Precious metal certificates

Current Market Prices

Zakat calculations require current market prices. Prices fluctuate daily, so check reliable sources:

  • Local jewelry stores
  • Precious metals dealers
  • Financial websites (London Metal Exchange, etc.)
  • Islamic finance institutions

Important Note

Use the selling price (what you would receive if selling) rather than the buying price (what you would pay to purchase) for more accurate Zakat calculations.

Record Keeping

Maintain proper records for your precious metals:

  • Purchase receipts with weight and purity details
  • Annual inventory of all gold and silver items
  • Market price records for Zakat calculation dates
  • Zakat payment receipts

Calculate Your Gold & Silver Zakat

Use our specialized calculator to determine your exact Zakat obligation on gold and silver assets with current market prices.

Calculate Gold & Silver Zakat

Conclusion

Calculating Zakat on gold and silver requires attention to purity, accurate weighing, and current market prices. Remember that the obligation applies to the pure metal content, not the total weight of alloys. When in doubt about jewelry for personal use, consult with knowledgeable Islamic scholars in your area.

Regular calculation and payment of Zakat on precious metals not only fulfills your Islamic obligation but also helps purify your wealth and contribute to the welfare of the less fortunate in your community.