Zakat on Gold in Saudi Arabia: Nisab, Rate and How to Calculate

Zakat on gold is one of the most frequently asked questions among Muslims holding gold as savings, and the arithmetic is simpler than the surrounding discussion suggests. Three things decide it: how much gold you hold, whether it exceeds the threshold, and whether a lunar year has passed.

The Nisab: 85 Grams

Nisab is the minimum holding at which zakat becomes due. For gold it is 85 grams of pure gold, derived from the classical measure of 20 mithqal. Below that threshold, no zakat is owed on gold alone.

The threshold is defined in pure gold, which matters when your holdings are jewellery rather than bullion. A hundred grams of 21K jewellery contains 87.5 grams of pure gold, so it clears the threshold. A hundred grams of 18K contains only 75 grams of pure gold and does not, considered alone.

The Rate: 2.5 Percent

Zakat on gold is levied at 2.5 percent, or one fortieth, of the value of the holding. It is paid on the current market value of the gold at the time zakat falls due, not on what you originally paid for it.

This is an important distinction. If you bought at a lower price years ago and the value has risen, zakat is calculated on today’s value. The purchase price is irrelevant to the calculation.

The Lunar Year Condition

Zakat becomes due once a full lunar year, the hawl, has passed while your holding remained at or above nisab. The lunar year is roughly 354 days, about eleven days shorter than the solar year.

Most scholars hold that the holding must remain above nisab throughout the year, with brief dips generally overlooked. Fix a date in the Hijri calendar as your annual zakat date and use it consistently. Many people choose Ramadan for convenience and remembrance, which is permissible though not required.

Worked Examples

Example one, 120 grams of 21K jewellery. Pure gold content is 120 multiplied by 0.875, which is 105 grams. That is above the 85 gram nisab. If the 24K rate is 526 riyals per gram, the value of the pure content is 55,230 riyals, and zakat at 2.5 percent is 1,380.75 riyals.

Example two, 60 grams of 24K bars. Pure content is 60 grams, which is below nisab. No zakat is due on the gold alone. However, if you also hold cash or silver, most scholars combine monetary assets, and the combined total may well exceed nisab.

Example three, mixed holdings. 40 grams of 21K equals 35 grams pure, plus 50 grams of 24K equals 50 grams pure, giving 85 grams total. That meets nisab exactly, and zakat is due on the full value.

Jewellery Worn Versus Jewellery Stored

This is the one genuine area of scholarly difference, and it is worth stating plainly rather than glossing over.

One view holds that gold jewellery in regular personal use is exempt, treating it as a personal effect rather than stored wealth. Another view holds that all gold above nisab is zakatable regardless of use, since gold retains its character as wealth. Both positions are held by recognised scholars and supported by evidence.

Gold held as savings, investment bars, coins, or jewellery kept in a safe rather than worn is treated as zakatable under both views. Where your situation falls in the disputed area, consult a scholar you trust. Many people choose to pay in order to be certain, which no view considers wrong.

What to Do About Stones and Alloy

Zakat is on the gold, not on the gemstones. If a piece is set with stones, deduct their weight and calculate on the gold weight only. Precious stones held for personal adornment are generally not zakatable, though stones held as trade inventory are treated differently.

Similarly, alloy metals in lower karats are not gold. This is why the calculation converts karat weight to pure gold content before applying the nisab test and the rate.

Practical Steps

• Weigh all your gold and note the karat of each piece
• Convert each weight to pure gold content by multiplying by the purity factor: 0.999 for 24K, 0.916 for 22K, 0.875 for 21K, 0.750 for 18K
• Add the results to get total pure gold grams
• Compare with the 85 gram nisab
• If at or above, multiply total pure grams by the current 24K rate per gram
• Multiply the result by 0.025
• Record the Hijri date so next year’s calculation falls on the same date

Paying in Gold or in Cash

Zakat may be paid in cash equivalent to the value owed, which is what most people do and what the calculator above produces. Paying with the gold itself is also valid where practical. What matters is that the correct value reaches eligible recipients.

The recognised categories of recipients are set out in the Quran and include the poor, the needy, those in debt and travellers in need. Many people in Saudi Arabia give through licensed charitable organisations, which handle distribution and issue receipts.

Frequently Asked Questions

What is the nisab for gold in grams?

85 grams of pure gold. Convert karat jewellery to pure content first, since 100 grams of 21K is only 87.5 grams of pure gold.

Is zakat due on jewellery I wear every day?

Scholars differ. One view exempts jewellery in regular personal use, another treats all gold above nisab as zakatable. Gold held as savings is zakatable under both views.

Do I use the price I paid or today’s price?

Today’s market value on the date zakat falls due. The original purchase price has no bearing on the calculation.

Can I combine gold with cash to reach nisab?

Most scholars combine gold, silver and cash when assessing whether nisab is met, since all are forms of monetary wealth.

Use the calculator above with today’s live rate, or see the 24K rate used for the pure gold valuation.