How is the zakah of trade goods calculated?
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The questioner : May Allah preserve you, Shaykh. My question is: How is the zakah of trade goods calculated?
The Shaykh : Trade goods are the assets that a person prepares for trade, meaning he has no purpose for them other than to trade in them.
They are subject to zakah when the lunar year of possession 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. And if the opposite is the case, such as if he bought it for twenty thousand and then its value dropped when zakah became due, meaning when his zakah year was completed, then he does not pay zakah on anything other than ten thousand.
The Shaykh : Trade goods are the assets that a person prepares for trade, meaning he has no purpose for them other than to trade in them.
They are subject to zakah when the lunar year of possession 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. And if the opposite is the case, such as if he bought it for twenty thousand and then its value dropped when zakah became due, meaning when his zakah year was completed, then he does not pay zakah on anything other than ten thousand.