What Kind Of Debts Are Deducted While Calculating Zakat?

What kind of debts are deducted while calculating zakat?

Those who are obligant to give zakat deduct debts involving the rightful shares from the goods in possession liable to zakat. According to the general stance of the Hanafi school, due or nondue debts are subject to the same judgment. However, according to the view of some Hanafi scholars, only the due debts and those which are demanded to be paid by creditors are deducted while the debts not due yet are not deducted. Because these non-due debts are generally not demanded by creditors, but due debts are demanded to be paid (Kasani, Bada’i, II, 6).

According to the commonly-accepted view of the Shafi’i school, no debt is deducted from any goods liable to zakat; therefore, being indebted does not pose an obstacle to give zakat (Nawawi, al-Majmu’, V, 344).

The depth to be paid in a long-term payment plan and be paid regularly in the future years such as cooperative and credit debts must not be deducted from zakat goods completely. Because such payments cover very long terms as 10-20 years, and the person does not have to pay them all at once in the same year.

In this regard, only “the debts to be paid that year, and due or to be due debts of that zakat year” must be deducted. Because zakat is an annual worship.

Source: Presidency Of Religious Affairs The Turkey, High Board of Religious Affairs FATWA