Here is the amount of RM ……. as I pay Zakat on ASB investments and dividends which is obligatory on myself/the party I represent for the year ………… in the name of Allah SWT.
Jumlah Minima: RM10
Zakat payers will receive 100% tax rebates from the Inland Revenue Board of Malaysia (LHDN)
Company will receive a 2.5% tax rebate from the Inland Revenue Board (LHDN).
Your zakat payment will go directly to the bank account of the Selangor Zakat Board, without passing through any other entity's account
The collection of Zakat proceeds is directly channeled to the Asnaf groups in Selangor through the Selangor Zakat Board
Zakat payers will receive 100% tax rebate from the Inland Revenue Board of Malaysia (LHDN)
Company will receive a 2.5% tax rebate from the Inland Revenue Board (LHDN).
Your zakat payment will go directly to the bank account of the Selangor Zakat Board, without passing through any other entity's account
The collection of Zakat proceeds is directly channeled to Asnaf groups in Selangor through the Selangor Zakat Board
Investment in any form is an activity that increases wealth so it is appropriate to pay zakat so that the proceeds can be distributed among those who need help. Among these types of investments include investments in unit trust management companies such as Amanah Saham Nasional Berhad – also known as ASB, which is the largest in the country. If you have an investment in ASB, then you need to know if you are obliged to pay ASB zakat or not.
Meanwhile, apart from the obligation to pay ASB zakat, some also ask if ASB zakat is paid on its profits only, or does it include capital investment? Read more for important information about ASB zakat payment.
According to the hadith of the Prophet SAW, which means:
“When you have 200 dirhams and you have enough haul (an even year or a whole Hijriah year), it is obligatory to pay zakat of five dirhams, and it is not obligatory to pay zakat unless you have 20 dinars.” If you have 20 dinars and have enough haul, it is obligatory to pay half a dinar in zakat. The same is the rate if the value increases and no zakat is required for a property except for an even year.” (Narrated by Abu Dawud and al-Baihaqi)
Meanwhile, there is also another hadith that states (which means): “Zakat on silver is one-fortieth (1/40) of the value of the silver.” (Narrated by Imam Al-Bukhari)
Based on this hadith, converting the value of half a dinar (0.5) of the total value of 20 dinars is set at a rate of 2.5%. Likewise according to the second proposition, 1/40 is equivalent to 2.5%. Therefore, there is no doubt that the zakat rate is 2.5% and it is clear that paying zakat on your ASB investment is an obligation for investors.
Just like the conditions for paying zakat for other property, the conditions for paying zakat for ASB are as follows:-
It should be noted that age is not a determinant of the obligatory payment of zakat. Therefore, even a child or an infant must pay zakat if the conditions are sufficient. This responsibility falls on the guardian or the child to ensure that zakat is paid when the time comes.
Circling back to the question if zakat on ASB is calculated based on the total value, the principal value or only the interest value, let’s see the excerpt that has been shared by the Shariah Unit Manager of the Zakat Collection Center – Islamic Religious Council of the Federal Territory (PPZ-MAIWP), Ahmad Husni Abdul Rahman, as appearing in the Sinar Harian news portal.
According to Ahmad Husni, the calculation of zakat for ASB using its own capital and the calculation of zakat for ASB based on loan financing are different. In fact, there are actually several ways zakat is calculated on ASB investments.
The ways of calculating zakat on ASB investments are as in the following examples:-
ASB investment is made using own money or capital: The calculation method is based on the amount of capital mixed with dividends earned.
Example:-
RM100,000 (investment capital) + RM7,250 (example dividend of 7.25%) + RM100 (1% of the first 10,000 units) = This is the amount that is subject to zakat, which is RM107,350.
At a rate of 2.5%, the amount of ASB zakat that must be paid is as follows:
RM107,350 x 2.5% = RM2,683.75
ASB investments obtained through loan financing: For ASB investments made through loan financing from banks, zakat is only charged if the amount of dividends exceeds the nisab in that year.
Examples of how to calculate:
The investment capital is as much as RM100,000 (in the form of an investment certificate). For example, the dividend is taken as 7.25%, and is added with an ASB bonus of 1% from the first 10,000 units. Therefore, in this calculation example, dividend + bonus of = RM7,350.
At the rate of 2.5%, the zakat payable is calculated as follows:-
2.5% x RM7,350 = RM183.75
It may be seen here that the value of RM7,350 is far from the usual nisab level (for example, in the state of Selangor for July-December 2022, the nisab rate is RM21,432). However, often zakat is imposed on investments unless the amount of other property owned by the investor is insufficient for nisab and the ASB investment is the only property owned.
Calculation of zakat for investors who close an investment account through financing: If the surrender rate exceeds the nisab, then ASB zakat must be paid on the value of this surrender.
Examples of how to calculate:
The surrender value of the certificate in the final year of financing is as much as RM100,000. An example of a dividend is taken as much as 7.25%. In this example, the dividend is = RM7,250.
At the rate of 2.5%, the zakat payable is calculated as follows:-
2.5% x (RM100,000 + RM7,250) = RM2,681.25
If you are not sure which calculation to follow for your investment, check up and confirm how you earn profit from your ASB investment. Then, you can use Bayar Zakat Malaysia‘s ASB zakat calculation calculator to determine the amount to be paid and then you can continue to pay at here.
In the meantime, don’t forget to make sure of the proper nisab rate because it varies every year and also varies according to the religious department in each state.
