You can plan for years for your Zakat calculation. Zakat has not only implication during life but it must be paid after a person die as a part of estate settlements. You can keep this excel file updated for your executors and trustees of Islamic Will and Trust. You can download HERE free to better plan your Zakat.

Zakat is the purification for money as well as on body. Abu Huraira reported God’s messenger as saying, “There is zakat applicable to everything, and the zakat of the body is fasting.” (Ref. Mishkat al-Masabih 2072, Book 7, Hadith 115). Zakat is the least fair amount (i.e., 2.5%) which is way less than taxes are paid to revenue agency. The main difference between the taxes paid and Zakat is that you pay taxes which goes on hand of unknowns which you really do not have control but Zakat you pay directly to a needy which can turn into huge reward as per Islamic ruling. There are many important narrations found in book of Hadith are as follows.

Zakat amont

The Messenger of Allah (ﷺ) said: `I have relieved you of zakah on horses and slaves, so give zakah on silver: for every forty dirhams, one dirham. There is no zakah on one hundred and ninety, but if it reaches two hundred, then five dirhams are due (in zakah).` - Musnad Ahmad 711

Zakat payable

Following narrations relate to Zakat eligibility.

1. Umm Salama said she was wearing gold ornaments and asked God’s messenger whether that was a treasure,* to which he replied, “Whatever reaches a quantity on which zakat is payable is not a treasure when the zakat is paid.” Malik and Abu Dawud transmitted it. * The word kanz which means a treasure is used as a technical term for property liable to zakat on which the zakat is not paid. - Mishkat al-Masabih 1810, Book 6, Hadith 39

2. Narrated Abu Sa`id Al-Khudri: Allah's Messenger (ﷺ) said, "No Zakat is imposed on less than five Awsuq of dates; no Zakat is imposed on less than five Awaq of silver, and no Zakat is imposed on less than five camels." - Sahih al-Bukhari 1459, Book 24, Hadith 61

3. Yahya related to me from Malik from Nafi that Abdullah ibn Umar used to adorn his daughters and slave-girls with gold jewellery and he did not take any zakat from their jewellery. Malik said, "Anyone who has unminted gold or silver, or gold and silver jewellery which is not used for wearing, must pay zakat on it every year. It is weighed and one-fortieth is taken, unless it falls short of twenty dinars of gold or two hundred dirhams of silver, in which case there is no zakat to pay. Zakat is paid only when jewellery is kept for purposes other than wearing. Bits of gold and silver or broken jewellery which the owner intends to mend to wear are in the same position as goods which are worn by their owner - no zakat has to be paid on them by the owner." Malik said, "There is no zakat (to pay) on pearls, musk or amber." - Muwatta Malik, Book 17, Hadith 11

Zakat not payable

1. Yahya related to me from Malik from Yazid ibn Khusayfa that he had asked Sulayman ibn Yasar whether zakat was due from a man who had wealth in hand but also owed a debt for the same amount, and he replied, "No." - Muwatta Malik, Book 17, Hadith 598

2. It was narrated from Abu Sa'eed Al-Khudri that the Messenger of Allah said: "No Zakah is due on wheat or dates unless the amount reaches five Awsuq. No Zakah is due on silver unless the amount reaches five Awaq. No Zakah is due on camels until the number reaches five Dhawd." - Sunan an-Nasa'i 2484, Book 23, Hadith 50

3. Narrated Abu Sa`id: Allah's Messenger (ﷺ) (p.b.u.h) said, "No Zakat is due on property mounting to less than five Uqiyas (of silver), and no Zakat is due on less than five camels, and there is no Zakat on less than five Wasqs." (A Wasqs equals 60 Sa's) & (1 Sa=3 K gms App.) - Sahih al-Bukhari 1405, Book 24, Hadith 10

Receiving Zakat

Abu Sa'id Al-Khudri narrated that The Messenger of Allah (ﷺ) said: “Zakah is not allowed for the well-off person except for one of the following five: an administrator of Zakah, a man who buys Zakah holdings with his money, a person who is in debt, a fighter in the cause of Allah, or a rich person who is given a present by a needy (miskin) person which the latter had been given as Zakah.” - Bulugh al-Maram, Book of Zakah, Book 4, Hadith 643

Necessity of Paying zakat

Following narrations relate to compulsion of paying zakat.

1. It was narrated that 'Abdur-Rahman bin Hilal said: "Jarir said: 'Some Bedouin people came to the Prephet and said: O Messenger of Allah, some of your Zakah collectors come to us and they are unfair. He said: Keep your Zakah collectors happy. They said: Even if they are unfair? He said: Keep your Zakah collectors happy. Then they said: Even if they are unfair. He said: Keep your Zakah collectors happy. Jarir said: No Zakah collector left me, since I heard this from the Messenger of Allah but he was pleased with me." - Sunan an-Nasa'i 2460, Book 23, Hadith 26

2. Narrated Khalid bin Aslam: We went out with 'Abdullah bin 'Umar and a bedouin said (to 'Abdullah), "Tell me about Allah's saying: "And those who hoard up gold and silver (Al-Kanz - money, gold, silver etc., the Zakat of which has not been paid) and spend it not in the Way of Allah (V.9:34)." Ibn 'Umar said, "Whoever hoarded them and did not pay the Zakat thereof, then woe to him. But these holy Verses were revealed before the Verses of Zakat. So when the Verses of Zakat were revealed, Allah made Zakat a purifier of the property." - Sahih al-Bukhari 1404, Book 24, Hadith 9

3. Narrated Anas: Abu Bakr wrote to me what Allah's Messenger (ﷺ) has made compulsory (regarding Zakat) and this was mentioned in it: If a property is equally owned by two partners, they should pay the combined Zakat and it will be considered that both of them have paid their Zakat equally. - Sahih al-Bukhari 1451, Book 24, Hadith 54

4. Narrated Abu Huraira: Allah's Messenger (ﷺ) said, "On the Day of Resurrection the Kanz (Treasure or wealth of which, Zakat has not been paid) of anyone of you will appear in the shape of a huge bald headed poisonous male snake and its owner will run away from it, but it will follow him and say, 'I am your Kanz.'" The Prophet (ﷺ) added, "By Allah, that snake will keep on following him until he stretches out his hand and let the snake swallow it." Allah's Messenger (ﷺ) added, "If the owner of camels does not pay their Zakat, then, on the Day of Resurrection those camels will come to him and will strike his face with their hooves." Some people said: Concerning a man who has camels, and is afraid that Zakat will be due so he sells those camels for similar camels or for sheep or cows or money one day before Zakat becomes due in order to avoid payment of their Zakat cunningly! "He has not to pay anything." The same scholar said, "If one pays Zakat of his camels one day or one year prior to the end of the year (by the end of which Zakat becomes due), his Zakat will be valid." - Sahih al-Bukhari 6957-6958, Book 90, Hadith 5

5. Narrated Abu Huraira: Allah's Messenger (ﷺ) (p.b.u.h) ordered (a person) to collect Zakat, and that person returned and told him that Ibn Jamil, Khalid bin Al-Walid, and `Abbas bin `Abdul Muttalib had refused to give Zakat." The Prophet said, "What made Ibn Jamil refuse to give Zakat though he was a poor man, and was made wealthy by Allah and His Apostle ? But you are unfair in asking Zakat from Khalid as he is keeping his armor for Allah's Cause (for Jihad). As for `Abbas bin `Abdul Muttalib, he is the uncle of Allah's Apostle (p.b.u.h) and Zakat is compulsory on him and he should pay it double." - Sahih al-Bukhari 1468, Book 24, Hadith 70