CALCULATING ZAKAT ON SHARES

Zakat on Shares relates to investment tools comprising stocks, shares, ETFs, REITs, and others.

A share is a divided-up unit of the value of a company. If a company is worth $100 million and there are 50 million shares in issue, then each share is worth $2.

A company’s shareholder is a partner in ownership of the company in accordance with the amount of shares he owns in the company.

Unlike Zakat on Savings which takes the lowest value of savings during the Haul period that has reached the Nisab, Zakat on Shares is 2.5% the market value of the shares at end of the Haul or financial year period. This is because shares fluctuate in value more rapidly.

Ready to calculate your Zakat and make payment?

THINGS TO FIND OUT FIRST:

The Nisab for the month.
Find it at www.zakat.sg or Berita Harian.
Find out the number of shares purchased from a company.
You may check in your brokerage account(s).
Find out the Haul date. If the shares are from a single company, the Haul is 355 days from the date of purchase. If the shares are from multiple companies, the Haul is end of the financial year of the companies.
Find out the value per share unit at Haul date (for single company shares).
For shares from multiple countries, find out the value at the end of the financial year.
SINGLE COMPANY SHARES
Determine the total value of shares: Number of shares × Value per unit
If the total value is below Nisab, there is no Zakat payable.
If the total value is above Nisab, Zakat payable: Total value of shares × 0.025
MULTIPLE COMPANIES SHARES
Determine the total value of shares for each company: Number of shares × Value per unit
Add together the grand total values of all companies. If the total value is below Nisab, there is no Zakat payable.
If the total value is above Nisab, Zakat payable: Total value of shares × 0.025

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