FAQS
FAQs on Zakat on Shares
- What zakat rate does incur on shares investment?
Zakat rate on shares is similar to zakat rate on standard personal wealth rate which is 2.5 percent.
- What is the nisab (floor amount) and haul (applicable period) for zakat on shares?
Nisab and haul on shares is similar to other zakat types. Zakat is payable only if the amount reach nisab and haul. Nisab and haul can be referred to the respective zakat authorities.
- What is the calculation methodology for zakat on shares?
The methodology differs for shares held for short term (purchased with intention to sell within a haul) and long-term (purchased with intention to hold and enjoy dividend).
- How is zakat calculated if the intention of purchase is for holding and enjoying dividend payment?
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For this case, Zakat is calculated at 2.5% of the value of all shares plus dividend and current balance of Trust Account, deduct outstanding financing amount (which is obtained for the purpose of buying shares, if any) and transaction costs.
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If various shares are purchased on different dates, payment date for zakat is subject to completion of haul of the respective shares.
Example:
Zakat on shares X payable:Date of purchase of Shares X 10 Jan 2020 Haul Haul has been reached Number of shares owned 100,000 units Value per unit share RM1.30 (price reference shall be subject to zakat authorities e.g. at the end of Haul or lowest price in the period of Haul) Dividend Received Dividend is RM 0.01 per share x 100,000 units of shares
= RM 1,000.00Current Balance of Trust Account RM 10,000 Transaction Costs RM 300
= (RM1.30 x 100,000 units) + RM 1,000 + RM 10,000 – RM 300.00
= RM140,700 x 2.5%
= RM 3,517.50-
Zakat is payable subject to meeting applicable nisab requirement of respective zakat authorities.
Reference: https://www.zakat.com.my/info-zakat/jenis-jenis-zakat/zakat-saham/
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- How is zakat calculated if the shares are purchased with intention to sell within a short term?
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For this case, zakat is calculated at 2.5% of the disposal gain i.e. the sale value plus current balance of Trust Account minus transaction costs.
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This calculation shall not include borrowed shares.
Example:
Date of purchase / sale of Shares Y 10 Jan 2020 / 20 Jan 2020 Haul n.a. Number of shares owned 50,000 units Purchase Value RM1.50 Sale Value RM1.70
Zakat on shares Y payable:
= ([RM1.70 - RM1.50] x 50,000 units) + RM 10,000.00 – RM 150.00
= RM19,850 x 2.5%
= RM 496.25-
Zakat is payable subject to meeting applicable nisab requirement of respective zakat authorities.
Reference: https://www.zakat.com.my/info-zakat/jenis-jenis-zakat/zakat-saham/
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- After calculation, how is the zakat sum paid?
Zakat can be paid to any zakat authorities.
List of Zakat authorities in Malaysia:
Wilayah Persekutuan: http://www.zakat.com.my
Selangor: http://www.zakatselangor.com.my
Perlis: https://www.maips.gov.my
Kedah: https://www.zakatkedah.com.my
Penang: http://www.zakatpenang.com
Perak: https://www.maiamp.gov.my
Negeri Sembilan: https://www.zakatns2u.biz
Melaka: http://www.izakat.com
Johor: https://www.maij.gov.my
Pahang: http://www.zakatpahang.my
Terengganu: http://maidam.gov.my
Kelantan: https://www.e-maik.my
Sarawak: https://www.tbs.org.my
Sabah: https://appszakat.sabah.gov.my - If the issuing company paid zakat on its business or Business Zakat, should there be any payment of zakat by investors?
If the company pays Business Zakat, the shareholders do not need to pay Zakat on the dividend received to avoid double payment of zakat.
- Is Zakat applicable for Bursa Malaysia Berhad (1818) shareholders??
For FY2020, the Board of Directors (BOD) of Bursa Malaysia Berhad has approved and declared a final dividend of 26.0 sen per share and a special dividend of 8.0 sen per share for FY2020, the BOD also announced the inaugural Business Zakat payment of RM667,000.
Hence, no Zakat is applicable on the dividend received by shareholders. - Is investment in Shariah non-compliant shares subject to zakat?
No, Zakat is only applicable to Shariah-compliant assets only. Zakat is also not applicable to gain from disposal as a result of reclassification of Shariah status Shariah non-compliant; such gain shall be treated in accordance to the Shariah Advisory Council of Securities Commission Malaysia's recommendation.
- Is investment in Shariah-compliant shares by non-Muslims subject to zakat?
Zakat is applicable to Muslims shareholders only.
2.5%
=RM250