How Zakat on Stocks Works
The majority of scholars agree that publicly traded shares are zakatable at their current market value. On your Zakat anniversary date (hawl), take the closing price of each holding, multiply by the number of shares, and apply 2.5%.
For Shariah-screened funds, the entire NAV is used. If a fund contains non-compliant holdings, you may need to purify dividends separately—consult your advisor.
Frequently Asked Questions
Is Zakat due on stocks?
Yes. Stocks held as investments are zakatable based on their current market value on your Zakat anniversary date. You owe 2.5% on the total value.
What about stocks I trade frequently?
Actively traded stocks are treated like business inventory—Zakat is due on the full market value. For long-term holdings, some scholars allow Zakat only on dividends received.
Do I combine stocks with other assets?
Yes, stocks are added to your total zakatable wealth—including cash, gold, and crypto—before comparing against the Nisab threshold.
Are mutual funds and ETFs treated the same way?
Yes. Shariah-compliant mutual funds and ETFs are valued at their current net asset value (NAV), and 2.5% Zakat applies to that total.