Zakat Foundation™ is a global charity organization that aims to alleviate poverty and suffering among vulnerable communities worldwide. One of the ways the organization achieves its goals is through the collection and distribution of Zakat, a mandatory charitable contribution for Muslims.
One of the sources of Zakat is the money held in fixed deposit accounts. Fixed deposits are financial instruments offered by banks and financial institutions that allow investors to deposit a lump sum of money for a fixed period, typically ranging from 1 month to 10 years, at a fixed interest rate. These accounts are popular among conservative investors who seek a guaranteed return on their investment.
The question arises whether Zakat is payable on the money held in fixed deposit accounts. According to Islamic jurisprudence, Zakat is payable on any wealth that meets the nisab threshold and has been held for a lunar year. The nisab is the minimum amount of wealth a Muslim must possess before being liable to pay Zakat. As of 2021, the nisab is 85 grams of gold or its equivalent in cash or assets.
The money held in fixed deposit accounts is considered part of one's wealth and is subject to Zakat if it meets the nisab threshold and has been held for a lunar year. The calculation of Zakat on fixed deposit accounts is based on the total balance of the account on the Zakat due date, which is usually the end of the lunar year.
The Zakat payable on fixed deposit accounts is based on the rate of Zakat, which is 2.5% of the total balance. For example, if a person has a fixed deposit account with a balance of $10,000 on the Zakat due date, the Zakat payable would be $250.
Zakat Foundation™ plays an essential role in collecting and distributing Zakat on fixed deposit accounts. The organization provides a platform for Muslim donors to pay their Zakat online, making it easy and convenient for them to fulfill their religious obligation. The Foundation also ensures that the Zakat collected is distributed to the eligible beneficiaries according to Islamic principles.
The beneficiaries of Zakat include the poor and needy, debtors, travelers, and others in need. The Zakat collected on fixed deposit accounts can be used to provide food, shelter, healthcare, education, and other basic needs to the vulnerable communities worldwide.
In conclusion, Zakat on fixed deposit accounts is a mandatory religious obligation for Muslims. The money held in fixed deposit accounts is subject to Zakat if it meets the nisab threshold and has been held for a lunar year. Zakat Foundation™ plays a vital role in collecting and distributing Zakat on fixed deposit accounts, ensuring that the Zakat is used to alleviate poverty and suffering among vulnerable communities worldwide.
