Zakat on Original Purchase value
I have purchased 100gms of gold for Rs. 250,000. Now the sale value is Rs. 270,000 but if I want to buy 100 gm of gold then the value is Rs. 300,000. Please calculate my zakat.
Islamic Voice replies:
You will have to take out 2.5% of Rs. 250,000 towards Zakat. Kindly be reminded that even in future you will be taking out Rs. 2.5% of the Rs. 250,000. An ordinary Aalim from a madrassas would tell you that you should calculate the value of the gold according to ruling market prices. It is not correct. They say this because they are generally the recipients of such Zakat amount. Suppose the value of the 100 gram gold rises upto Rs. 10 lakh after 10 years, you are liable to pay zakat according to the price you paid at the time of purchase of such gold jewellery. However, if you sold the gold, the Zakat will be calculated as per the amount obtaining from the sale.