This article is Part 7 of the series titled, 'Zakat Made Easy'
Giving Items as Zakat Instead of Cash?
As per the Shariah, it is required that a person gives zakat on one’s wealth in the form of money. It is not permissible to be given in kind in the form of various items etc.The person gives the zakat to the eligible beneficiaries and their involvement with the money is complete. They have transferred the trust in their care to its rightful owner. Now, the person has absolutely no right to dictate to the beneficiary on how the money is to be utilized.
Sheikh Ibn al-Uthaymeen said, “Zakat on money must be given in cash; it cannot be given in the form of other items, unless the poor person made a request of you and said: If you receive money for me, then buy me such and such with it. In that case there is nothing wrong with it.” [Majmu’ Fataawa wa Rasaa’il Ibn Uthaymeen]
This is the general rule. But if it is known for sure that the money will not be utilized in the proper manner or the person is incapable of using the money in the proper manner, Sheikh al-Islam Ibn Taymiyyah said:
“Giving items of equivalent value when there is no need and no obvious interest to be served is not allowed…. Because if it were made permissible to give items of equivalent value, then the giver may give bad quality items or the evaluation may not be correct. Zakat is intended to help the poor, and the zakat is connected to the amount of wealth one owns and its type. However, with regard to giving items of equivalent value when there is a need for that or an interest to be served thereby, or to achieve fairness, there is nothing wrong with that.” [Majmu‘ al-Fataawa]
In such a scenario, it is good to go with the person and buy with them or buy on their behalf that which they need. Many charity bodies need to remember that this is the exception to the rule and not the rule itself. The Hanafi madhab in particular does allow for the permissibility of giving items of need instead of cash when there is a need.
The Reality On The Ground
The World's 22 richest men have more money than all the women in Africa combined. [Oxfam]
The institution of Zakat is not just a mere religious exercise. If understood and carried out correctly, it has the potential to bring about widespread change, empower the poor and needy, and eradicate financial exploitation.
The National Zakat Foundation (UK) states, “The woes of modern day Zakat are in stark contrast to the success of Umar bin Abdul-Aziz, who is oft-mentioned as the poster child of Zakat success. Historical accounts show that there was a surplus of Zakat funds during his reign i.e. there was so little poverty, that Zakat eligible recipients were scant. Contemporary studies show that if everyone were to pay their Zakat in particular Muslim countries, absolute poverty would be significantly reduced, or even eradicated (Islamic Social Finance Report, 2014). However, actual mobilisation of Zakat funds is particularly low. In this respect, Umar’s commitment to fairness was a factor which reduced the gap between actual and potential Zakat funds. From this we can garner that trustworthiness of a Zakat institute is crucial to encourage people to pay Zakat.
The way Zakat funds were used was also a major success factor. The focus was upon encouraging agriculture and general productive capacity. This contributed towards an increase in income, causing more to be eligible for paying Zakat, and less people eligible to receive Zakat. As such Zakat revenues increased. Economic theory also supports the focussing upon agriculture as a starting point of economic development.”
Should we just invest the zakat funds to get more funds? Sheikh Ibrahim Nuhu حفظه الله said, “Zakat and Waqf is for the current needs of the people. It is needed NOW. Investing these funds for future benefit cannot take precedence over the current needs of the people. I dare anyone to come and tell me that there are people or a place where zakat and waqf is not needed. These investments can only be done when there is no one to benefit from the zakat and such a thing doesn't exist now. From the Sunnah is to take the Zakat from the rich and give it to the poor immediately. There is no room to invest the Zakat. Investment carries a lot of risk. Who guarantees the risk? Who monitors it? How can you do business with money you don't even own? Who gave you the permission to think and act on behalf of someone else?”
This is the classical position and the safest opinion.
That being said, the reality on the ground is very different. The Third Symposium of Zakat Contemporary Issues held in Kuwait (1992) set out detailed conditions under which zakat funds could be invested. These are:
- There must not be urgent channels which require immediate application of zakat funds.
- Zakat funds must be invested in a legal and Shariah-permitted manner.
- Necessary precautions should be taken so as to guarantee that the rules of zakat continue to apply to the original invested money as well as to its profits.
- Invested assets must be liquidated if zakat recipients need zakat in cash. (This point takes into account the concern raised by the more conservative group of scholars on the matter.)
- It must be ensured that such investments will be safe, lucrative and can be liquidated in times of need.
- The decision of investing zakat funds should be taken by the government officials entrusted with the task of levying and distribution of zakat. Such investments should be supervised by efficient experts.
Gap between Global Potential and Actual Zakat Collection
Two studies by IRTI-IDB and WB estimate potential global zakat collection in the range of USD 550-600 billion. Against this potential, how much zakat is mobilized across the world? A back-of-the-envelope calculation provides some interesting insights. Rounding off the latest actual collection figures as reported by various issues of the IRTI Islamic Social Finance Report (Obaidullah et al, 2014, 2015, 2017), we find that
Saudi Arabia (USD 4 billion), Malaysia (USD 600 million), Indonesia (USD 270 million), Sudan (USD 225 million), India and Pakistan (USD 100-150 million each), Islamic Relief Worldwide – collected from 1st world Muslims – (USD 100 million), Singapore (USD 20 million), Brunei (USD 15 million), South Africa (USD 10 million) – add up to USD 5.5 – 6 billion.
This works out to be around one percent of the estimated potential.Note that among other notable countries with significant Muslim population, Iran doesn’t have zakat. Muslims in Russia, CIS countries and African countries collect negligible zakat (Russia: USD 5.9 million; Nigeria: USD3.3 million). Turkey mobilizes zakat, but through a handful of NGOs only. If we add 3-4 billions from other GCC countries. A conservative global estimate will be about 10-15 billion USD. Therefore, at best a maximum of 2-3 percent of potential zakat is being actually collected.
Zakat has so much potential waiting to be tapped. Allah has given us the blueprint to our solutions. It is up for us to properly implement it and the first step is to educate ourselves and those around us with regards to this important issue.
Zakat al-Fitr
This is the second type of zakat that is prescribed upon Muslims. It is given at the end of Ramadan and before celebrating Eid. Allah says.
قَدْ أَفْلَحَ مَن تَزَكَّىٰ وَذَكَرَ اسْمَ رَبِّهِ فَصَلَّىٰ
"He has certainly succeeded who purifies himself and mentions the name of his Lord and prays” [Surah al-A'laa]
What is Zakat al-Fitr? It is an obligation upon every Muslim to pay this Zakat to show gratitude to Allah for allowing us to fast and experience the blessed month of Ramadan and also to make up for any shortcomings that we might have had while fasting. Those who have enough food for themselves and their families on the eve of Eid are obliged to pay it. A Muslim pays it for himself and for those he is responsible for such as his wife, children and others who he is obligated to provide for. Imam al-Bahuti further stated, "It is recommended to give it (Zakat al-Fitr) on behalf of a fetus (unborn baby)." [Umdat al-Talib]
Abdullah Ibn Abbas said: “Allah’s Messenger obligated Zakāt Al-Fitr as a purification for the fasting person from loose talk, indecent speech and to feed the poor.” [Abu Dawud]
Imam Wakee’ Ibn al-Jarrah (teacher of Imam ash-Shafi’i) said: "Zakat al-Fitr for the month of Ramadan is like prostration of forgetfulness for the Salah which repairs imperfection of the fast like the prostration of forgetfulness repairs the imperfection of Salah." [Al-Majmu’ 6/140]
Whom does it benefit? This Zakat is given so that the poor and the needy in our communities so that they can also enjoy and celebrate Eid. A poor person is classified as one who does not have enough money to satisfy his basic needs.
When is it due?
- The Zakat must be paid before Eid Salah. The practice of the Companions of the Prophet ﷺ was to pay Zakat al-Fitr one or two days before Eid (on 28, 29 or 30 of Ramadan)
- If it is paid after the Eid prayers, then it is counted only as normal charity. So make sure you pay it before that.
- The head of the household is responsible for making sure Zakat al-Fitr has been paid. If the children cannot pay it themselves, the head of the household should pay on their behalf.
How much should be paid? Abu Saeed al-Khudri said, “We used to give four cupped handfuls (1 Sa') of grain or barley or dates or dried curds or raisins.”
1 Sa' of food that is customarily eaten by the people; which is equivalent to 3 liters approximately. It is important to note that a Sa' is a measurement of volume and not a weight measurement. 1 Mudd is approximately 0.75 liters. 1 Sa' is equal to 4 Mudd (also a measurement of volume). It is best for Zakat al-Fitr to be distributed where you live.
What should be paid? Food, dried dates, barley, raisins, dried cheese or whatever is the staple food of the country. It should not be paid in the form of cash unless it is the ultimate final option. We have Zakat al-Maal for that.
Imam Ahmad bin Hanbal stated: “Cash payment is not to be given (as Fitr to the poor).” It was said to him: “Some people say Umar Ibn Abdul Aziz took it in cash.” He replied: “They leave the saying of Allah’s Messenger and instead say: ‘So-and-so said.’ Indeed ‘Umar said: ‘Allah’s Messenger obligated a Sa' (of food) as Zakat Al-Fitr.’”
Sheikh Ibn al-Uthaymeen said, "If they want they can eat it, if they want they can store it, if they want they can sell it, if they want they can gift it and if they want they can give it as charity on their own behalf. There is nothing upon us if they do this. What we have been commanded to do is to give them an amount of food."
His student, Sheikh Ibrahim Nuhu mentions the benefit of giving food for Zakat al-Fitr instead of money: "Either the person eats it and satisfies the hunger or sells it to make a profit. When he wants to sell it he'll have to make an effort for it and this will teach him about business. If you just give money, they'll spend it and beg again. This is a way how the Sunnah indirectly teaches the people to both meet their needs and also learn how to sustain themselves."
Please notify us if you come across any mistakes or errors. Any mistakes are from me and Shaitan and all the good is from Allah and the teachings of His Messenger.
This article is Part 7 of the series titled, 'Zakat Made Easy'
Part 1: What Is Zakat and Why Should I Pay It?
Part 2: Analyzing Zakat In The Quran
Part 3: Conditions and Calculation Methods
Part 4: Cash, Gold, Silver, Property and Business Assets
Part 5: Shares, Lifestock, Crops, and Cryptos
Part 6: Recipients and Distribution
