Is the end-of-service gratuity subject to zakah for the years it was earned?
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Fatwa No. ( 7472 )
Q: I bring to your attention that the company I work for grants the employee a gratuity of 15 days' salary for each year of service, but this gratuity is paid out only after the end of service. I ask your Eminence to issue a ruling: After my service ends and I am granted this gratuity for the years of service I completed, is it subject to zakah or not?
A: If the situation is as described, there is no zakah due on that gratuity until you receive it, and the lunar year begins to count from the date you receive it. And success is from Allah, and may Allah send prayers and blessings upon our Prophet Muhammad, his family, and his Companions.
Q: I bring to your attention that the company I work for grants the employee a gratuity of 15 days' salary for each year of service, but this gratuity is paid out only after the end of service. I ask your Eminence to issue a ruling: After my service ends and I am granted this gratuity for the years of service I completed, is it subject to zakah or not?
A: If the situation is as described, there is no zakah due on that gratuity until you receive it, and the lunar year begins to count from the date you receive it. And success is from Allah, and may Allah send prayers and blessings upon our Prophet Muhammad, his family, and his Companions.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.