Requires detailWorship · Zakat
Do I pay Zakat on the annual salary that I earn?
The answer
Zakat is not like income tax where the annual salary is taxed after a tax-free threshold. Instead, Zakat is simply paid on the residual/net wealth on one’s Zakat anniversary. Thus, the amount earned in the course of the year is irrelevant as per the calculations in the Hanafi school. Zakat will be paid on the net wealth one has on their Zakat anniversary.
In short: Zakat is on net wealth held on the Zakat anniversary, not on salary earned.
And Allah knows best.
Mufti Faraz Adam
Based on the Hanafi school and on the question as it was asked. Another mufti may reach a different conclusion. Read the disclaimer.