How to Calculate Zakah on Trade Goods
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Noble Shaykh, how is zakah calculated on trade goods?
Trade goods are the assets a person prepares for trade, meaning: he has no purpose for them other than to trade in them. Zakah is due on them when the lunar year has passed. Their value is assessed at the time zakah becomes due, whether that value is the same as what he paid for them, less, or more. For example, if a person owns land that he bought for trade, and he bought it for ten thousand, and when his zakah year is completed it is worth twenty thousand, then it is obligatory for him to pay zakah on twenty thousand. If the situation is the opposite, such as if he bought it for twenty thousand and its value dropped to ten thousand when zakah became due, i.e., when his zakah year was completed, then he only pays zakah on ten thousand.
Trade goods are the assets a person prepares for trade, meaning: he has no purpose for them other than to trade in them. Zakah is due on them when the lunar year has passed. Their value is assessed at the time zakah becomes due, whether that value is the same as what he paid for them, less, or more. For example, if a person owns land that he bought for trade, and he bought it for ten thousand, and when his zakah year is completed it is worth twenty thousand, then it is obligatory for him to pay zakah on twenty thousand. If the situation is the opposite, such as if he bought it for twenty thousand and its value dropped to ten thousand when zakah became due, i.e., when his zakah year was completed, then he only pays zakah on ten thousand.