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:

Dear Brother,
i hv qustion about gratuity.
understand provident fund is zakat able, pls. advise about gatuity, do we hv to pay zakat on it?

thanx
ALLAH HAFIZ

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Answer:

Zakah on provident fund and gratuity

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 brother in Islam, whether it is provident fund or gratuity, the zakah will not be due on it unless and until one receives the money and has been in his possession for a period of twelve calendar months. Only when one actually receives the provident fund and/or the gratuity, then the zakah will be liable on it.

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