Zakaat on money loaned to people
Q: I am a married woman. I work from home giving extra lessons. I have loaned most of my savings money to family members. (interest free)
Do I need to pay zakaat on this money that I have loaned them?
Since I do not have much savings left; if I cannot afford the zakaat amount; will I have to sell my jewellery from my mother and my wedding jewellery to pay it?
A: Yes, zakaat is compulsory upon the monies you had loaned to people. However, you have the option to pay the zakaat of the loan amounts immediately or to discharge the zakaat of the money when you receive the money. In the case where you delay discharging the zakaat till the time you receive the money, you will have to discharge the zakaat for the previous years.
And Allah Ta'ala (الله تعالى) knows best.
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