Asalaam Alaikum
Would section 4 of your zakat guidance note apply to ISAs with the above companies.
Would gold held in these funds also come under the same calculation?
Asalaam Alaikum
Would section 4 of your zakat guidance note apply to ISAs with the above companies.
Would gold held in these funds also come under the same calculation?
I have just seen a response to another question regarding Wahed Invest and the response mentions a different calculation. I understand that any cash would incur the full 2.5% and I assume gold would fall under the same category ?
My portfolio is Moderately aggressive. I have emailed them and unfortunately they have said they are unable to offer guidance.
I appreciate any assistance
Wa alaykum salaam,
Gold held in these funds will be subject to 2.5% of Zakat similar to cash assets.
And the remainder? Would it be 25% at 2 5% or 40% at 2.5% as mentioned in the IFG zakat guidance notes section 4?
FUNDS
4.1 If you hold an investment in an equities fund (this is a fund that invests primarily in
stocks and shares), it is highly impractical to do a complete assessment of every
single company that the fund holds and work out your zakat. As such, the following
approach is recommended.
4.2 Take 40% of the value of your investment in the fund, and pay 2.5% zakat on it
(which is the same as saying pay 1% on your overall investment).
(a) Example: you hold ÂŁ10,000 in a fund (or across several funds). You pay 1%
(ÂŁ100).
4.3 If the fund is a property or sukuk fund, then no zakat is due as the underlying
investment is not zakatable7
.
There is a range of views on the “approximation” percentage to use.
Our view is a bit more conservative than NZF/Mufti Faraz’s view on this in that we went with 40% to be safe.
But 25% is an eminently sensible approach - and is actually backed up by research that NZF and Mufti Faraz have done of major fund holdings - so a lot more credible in our view than just 40% approximation.
(It also saves you zakat!)