Question 15 : Assalamualaykum Respected sheikh. One question from me – Do I have to pay zakat on stock market investment? Jazakumullahukhairan In advance for your answer

Answer:  Walaikumussalam Respected Br :-)

First it’s good to be aware that a fair many type of stock market investments are haraam, such as Options, futures, most government bonds that I have come across.

As for the halal ones, such as buying shares in a halal work company, if these are bought purely and solely for dividends then zakat is only payable on dividends once received and whatever portion of them stays with us – with the rest of our wealth – for one lunar year of the sum total of the remaining dividends and rest of our money/gold/silver reaches the Nisab amount.

But usually people buy stocks as a commodity to buy when the price is low and sell sooner or later when the price is higher, then acquire other stocks and do the same. In such a situation, which is almost always the case with most people, we treat the shares as a commodity/items on sale. So we check the value of shares we have for one whole year and give zakat of 2.5% on that value. If we have cash/gold/silver, then we add them together along with the share value we owned for the whole year, then we give zakat on that value at the end of one year (e.g. in each year Ramadan).

Br Ishad Mohammed I hope this answers your question also or sheds sufficient light on it :-)

Also the video I posted before and will post below inshallah sheds more light on this too.

An Easy way to calculate Zakat – a short video by SheikhAslam Abuismaeel