Zakat on modern monies: salaries, accounts and cryptocurrencies

The zakat of gold and silver applies, by equivalence, to any currency. The classical corpus sets the thresholds: twenty gold dinars, that is 85 grams, and two hundred silver dirhams, that is 595 grams, with a quarter of a tenth (2.5%) at the end of the hawl (Ibn Qudama, al-Mughni ; Mukhtasar Khalil ; Bidayat al-Mujtahid). The Prophet set the silver threshold: "no sadaqa is due below five awaq" (Muslim 987).

The regime of paper money

Modern currencies (euro, dollar, dirham) replace the gold/silver standard: zakat is computed on their value. Ibn Uthaymin clarifies: banknotes take the regime of gold and silver, and one keeps the threshold most favourable to the poor, generally that of gold (Majmu' al-Fatawa wa-Rasa'il, question on the zakat of banknotes). The hawl remains the rule: the salary enters the zakatable mass on the due date, not at each payment.

Accounts and investments

• Current accounts and savings books: zakat on the capital; unlawful interest is given in full to charity, without intention of reward, according to the rule of eliminating riba gains (Ibn Baz, Majmu' al-Fatawa).
• Shares: AAOIFI, Shari'a Standard No. 9 "Zakat", zakatizes shares held for investment like commercial goods, on the market value on the hawl day (the simple, widespread method) or on the zakatable assets of the portfolio (the analytical method).
• Life insurance and retirement: divergence according to the effective ownership of the funds; when recovery is certain, zakat bears on the acquired value.

Cryptocurrencies

The academic reference is resolution No. 237 (8/24) of the International Islamic Fiqh Academy (OIC), 24th session (Dubai, November 2019): it classifies electronic currencies into coins (such as bitcoin), altcoins and tokens, raises the question of their status (property, product, investment asset) and, given the volatility and risks, recommends further study rather than a global ruling. The Dar al-Ifta al-Misriyya (Egyptian House of Fatwa) had warned as early as 2018 against bitcoin trading. For zakat, the classical methodology remains the rule of commercial goods, zakatized on their market value (Mukhtasar Khalil): a lawfully held cryptocurrency therefore bears 2.5% of its value on the hawl day, with valuation at the due-date price given the volatility.

Practical note

The three-line method: list what is available (accounts, cash, crypto, certain receivables), value at the due-date price, take out 2.5% if the threshold is reached; short-term debts are deducted according to the jumhur.