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Atta-ur-Rehman

Can the Car Loan be Subtracted From My Zakat Calculation?

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Yes, it is permissible to deduct a car loan from Zakat.

Here are the key points to consider:

  • Deduction Allowed: You can deduct up to one year’s worth of loan payments from your wealth when calculating Zakat.
  • Excluding Interest: Only the principal portion of the loan repayment is considered; interest should not be deducted.
  • Short-Term Debts: This deduction applies to debts due within the upcoming year (i.e., the next 12 months).
  • Debt Duration: If the loan extends beyond a year, only the payments due within the year should be subtracted.
  • Zakat Calculation: After deducting the loan repayment amount, the remaining wealth calculates your Zakat obligation.

Hence, you can subtract up to one year of car loan payments from your total assets when calculating Zakat, provided the debt is due within that time frame.

And Allah knows best!

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WRITTEN BY

Atta-ur-Rehman

Atta-ur-Rehman, a specialist in Fiqh from Fazal-Jamiat-ul-Uloom-ul-Shariah, Jama'at ul-Umar Karachi, is an expert in Islamic jurisprudence. His expertise spans various aspects of Shariah, including Zakat, financial rulings, family laws, and ethical guidance in everyday life. With a deep understanding of Islamic principles, he provides a reliable insights into matters of faith, worship, and personal obligations.