Mu' meneen Brothers and Sisters,

As Salaam Aleikum wa Rahmatullahi wa Barakatuh.  (May Allah's Peace, Mercy and Blessings be upon all of you)

One of our brothers/sisters has asked this question:

Assalamualaikum
We own a house that is on mortgage. The mortgage is not fully paid yet. We live in the house and rent part of the house to cover mortgage payments every month. How do we calculate zakat on this. Also how does one pay zakat on the money they have in the bank. Because due to bill payments the amount left in the account varies from month to month.
Your quick response is appreciated very much.
Jazaakallah. 

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Answer:

Zakah calculation

In the name of Allah, We praise Him, seek His help and ask for His forgiveness. Whoever Allah guides none can misguide, and whoever He allows to fall astray, none can guide them aright. We bear witness that there is no one (no idol, no person, no grave, no prophet, no imam, no dai, nobody!) worthy of worship but Allah Alone, and we bear witness that Muhammad(saws) is His slave-servant and the seal of His Messengers.

Beloved sister in Islam, the general principle when determining the zakah dues is that it is payable on the excess wealth or excess nett worth of the person which has been in one’s possession for a period of one full calendar year.

Your Question: We own a house that is on mortgage. The mortgage is not fully paid yet. We live in the house and rent part of the house to cover mortgage payments every month. How do we calculate zakat on this.

There is no zakah applicable on the house one lives, or the car one drives, or the furniture and fixtures and assets one uses to live his normal life.

Thus in your particular case, you need to calculate the value of the property which has been rented out, and determine what share of the mortgage loan has already been paid on that part of the property; and then accordingly calculate 2.5% as the zakah dues.

Your Question: Also how does one pay zakat on the money they have in the bank. Because due to bill payments the amount left in the account varies from month to month.
Zakah will be due on any excess amount which has been in your possession for a full calendar year. If due to the movements in the account, the balance varies every month, one should take the average of the balance over a period of twelve months and calculate 2.5% as the zakah amount.

Whatever written of Truth and benefit is only due to Allah’s Assistance and Guidance, and whatever of error is of me. Allah Alone Knows Best and He is the Only Source of Strength.

Your Brother in Islam,

Burhan