Zakat on Shares Calculator – Calculate Zakat on Stocks Easily
Calculate Zakat on stock market investments and share holdings according to Islamic principles
Stock Holdings
Zakat on Shares/Stocks:
Stocks and shares are zakatable assets if their total value exceeds Nisab and has been held for one lunar year.
Two Main Approaches:
- Trading/Business Purpose: Zakat on full market value (2.5%)
- Long-term Investment: Zakat on full market value (2.5%) - used here
How to Calculate:
- List all stock holdings (company name/ticker)
- Enter number of shares for each holding
- Enter current market price per share
- Calculator automatically computes total value
- Checks if total exceeds Nisab
- Calculates 2.5% Zakat if eligible
Nisab Threshold:
Based on Silver Nisab (612.36 grams) - varies by currency
Zakat Rate:
2.5% (1/40) of total portfolio value
When to Pay:
- After holding shares for one lunar year (Hawl)
- Calculate on lunar year anniversary date
- Use market value on Zakat due date
- Pay even if shares have decreased in value
What Counts as Zakatable:
- All publicly traded stocks and shares
- Mutual funds and ETFs
- Private company shares (if tradeable)
- Stock portfolios and brokerage accounts
Halal Investment Considerations:
- Ensure companies are Shariah-compliant
- Avoid companies dealing in haram activities
- Consider halal screening services
- Purify any non-halal income received
Scholarly Opinions:
- Majority view: Zakat on market value (used in this calculator)
- Alternative view: Zakat only on dividends/profits
- Trading shares: Definitely zakatable like trade goods
- Consult scholar for your specific situation
Tips:
- Use portfolio statement for accurate values
- Check market prices on Zakat due date
- Include all brokerage accounts
- Combine with other assets for total Zakat
- Set annual reminder for Zakat calculation
Disclaimer: This calculator follows the majority scholarly opinion of paying Zakat on full market value. Different scholars may have different views, especially for long-term investments. Please consult with a qualified Islamic scholar for your specific situation.
Investing in stocks is one of the most common ways to build wealth today — but it also comes with a spiritual responsibility. For Muslims, wealth accumulation must align with faith, and that means fulfilling the obligation of Zakat on eligible investments.
At Digital Calculator, we make it simple to calculate Zakat on shares and stocks, ensuring your finances remain both profitable and pure.
Understanding Zakat on Shares
Zakat on shares (or stocks) is the annual almsgiving (2.5%) paid on the value of your investment holdings once they meet the nisab threshold and are held for one lunar year (ḥawl).
Zakat on shares applies to Shariah-compliant investments — meaning companies that do not engage in prohibited activities such as alcohol, gambling, or interest-based finance.
The key question for most investors is:
“Do I pay Zakat on the market value of my shares, or just on my profits?”
The answer depends on your intention behind buying those shares.
Two Types of Share Ownership
1. Shares Held for Trading (as Business Assets)
If you buy and sell stocks frequently with the intention of making profit (like a trader or investor), your shares are considered trading stock.
In this case, Zakat is due on the market value of the shares at the end of your Zakat year — similar to inventory in business.
Formula:
Zakat on Shares = (Market Value of Shares × Quantity) × 0.025
2. Shares Held for Dividends or Long-Term Investment
If your goal is to earn dividends and hold stocks long-term (not for trading), Zakat is due only on the zakatable assets of the company, not the total share value.That means you pay Zakat on the company’s net zakatable assets, which usually include cash, trade goods, and receivables — but not fixed assets like buildings or machinery.Because this can be complex, most scholars allow an approximate method using company financial statements or simply paying 2.5% on the current market value for simplicity and reward.
The Nisab Threshold for Zakat on Shares
Before paying Zakat, you must check if your total zakatable wealth meets the nisab — the minimum threshold of wealth that makes Zakat obligatory.
The nisab is based on:
- 85 grams of gold, or
- 595 grams of silver
To find the nisab in your local currency, multiply the price per gram by the number of grams.
Example:
If silver is $0.80 per gram →
595 × 0.80 = $476
If your total wealth (including shares, cash, gold, etc.) exceeds $476 and you’ve owned it for a lunar year, Zakat becomes obligatory.
Formula for Zakat on Shares
Depending on your investment type, here are the formulas you can use:
A. For Shares Held for Trading:
Zakat = (Current Market Value × Number of Shares) × 0.025
B. For Long-Term Investments:
Zakat = (Net Zakatable Assets per Share × Number of Shares) × 0.025
Net Zakatable Assets can be found in a company’s balance sheet or financial reports.
If unsure, many scholars recommend using the market value formula (A) for simplicity and to ensure your Zakat is not underpaid.
Step-by-Step Example
Let’s go through both scenarios with clear examples.
Example 1: Shares Held for Trading
Fatima owns 1,000 shares of a halal company. The market price per share is $10 at the end of her Zakat year.
Step 1: Find total market value
1,000 × $10 = $10,000
Step 2: Apply Zakat rate (2.5%)
$10,000 × 0.025 = $250
Fatima owes $250 in Zakat on her shares.
Example 2: Shares Held for Long-Term Dividends
Bilal owns 2,000 shares in a company he intends to keep long-term. Each share is worth $8, and the company’s zakatable assets make up 40% of its total value.
Step 1: Find zakatable portion per share
40% × $8 = $3.20 per share
Step 2: Multiply by total shares
2,000 × $3.20 = $6,400
Step 3: Apply 2.5%
$6,400 × 0.025 = $160
Bilal owes $160 in Zakat on his shares.
Table: Quick Zakat on Shares Examples
Investor Type | Shares Held | Price per Share | Zakat Basis | Zakat Due (2.5%) |
Trader (short-term) | 1,000 | $10 | Full Market Value ($10,000) | $250 |
Long-Term Investor | 2,000 | $8 | 40% Zakatable Assets ($6,400) | $160 |
Small Investor | 500 | $12 | Market Value ($6,000) | $150 |
Dividend Earner | 800 | $15 | 35% Zakatable Assets ($4,200) | $105 |
How to Calculate Zakat on Stocks Easily
- Determine the type of shares you hold.
Are you trading frequently or investing for long-term dividends? - Find the market value or zakatable asset ratio.
Check the current share price or company reports. - Calculate the total value.
Multiply your shares by the appropriate value. - Apply 2.5%.
Multiply the result by 0.025 to find your Zakat due. - Check the nisab.
Ensure your total wealth (including shares, cash, gold, etc.) exceeds the nisab before paying. - Pay your Zakat.
You can donate the amount in cash or sell shares equivalent to the Zakat amount.
Why Use Digital Calculator’s Zakat on Shares Tool?
Our Zakat on Shares Calculator eliminates guesswork and ensures accuracy.
With Digital Calculator, you get:
Accurate market-based calculation
Option for trading vs. long-term holdings
Up-to-date nisab values
Multi-currency support
Shariah-compliant results
Peace of mind and transparency
Our goal is to help you fulfill your duty effortlessly — so your wealth remains clean, compliant, and blessed.
Ready to calculate your Zakat on shares and stocks?
Use the Zakat on Shares Calculator on Digital Calculator to find your exact amount instantly.
Whether you’re a trader or a long-term investor, our calculator ensures every detail is covered — from nisab to share value.