How to work out zakat on checking accounts, savings, foreign currency, and money owed to you — with nisab, hawl, and a full worked example.
Published August 23, 2026 · Reviewed by the Ihsabha Editorial Team
Cash is the simplest form of wealth to hold and, on paper, the simplest to calculate zakat on: there is no market price to look up and no crop yield to estimate, just a balance and a percentage. In practice, though, cash and bank savings are where many people get their zakat wrong, not because the math is hard, but because of a handful of easy-to-miss details: which nisab threshold to apply, whether a bill due next week can be subtracted first, whether money a friend owes you counts, and what to do about interest that has quietly accumulated in an account. This guide walks through each of those points in order, then finishes with a complete worked example you can adapt to your own numbers.
Zakatable cash is broader than what sits in a savings account. It includes physical cash kept at home or in a wallet, balances in checking and current accounts, balances in dedicated savings accounts, money held in mobile wallets and digital payment apps, and foreign currency holdings converted to your home currency at the prevailing exchange rate. It also includes money you are actively saving toward a future goal, such as a house deposit or a wedding, since setting cash aside for later spending does not remove it from your zakatable wealth today; only cash that has actually left your possession, such as an upfront non-refundable payment, stops counting. You may also find it useful to check Who Is Eligible to Receive Zakat? The 8 Categories, which covers a related angle. Use the Cash & Savings Zakat Calculator below to check your own numbers quickly and accurately.
Nisab is the minimum amount of wealth a person must hold before zakat becomes due at all. Cash itself has no nisab value mentioned directly in the primary texts, so its threshold is derived by equating it to one of the two nisab values that are mentioned: gold or silver. The gold standard sets nisab at roughly 85 grams of pure gold, and the silver standard sets it at roughly 595 grams of silver. Because the market price of silver is far lower relative to gold than it historically was, the silver-based nisab in most currencies today works out to a noticeably smaller amount of money than the gold-based nisab.
Both standards are recognized positions among scholars, and Ihsabha's calculators let you pick either one. The majority of contemporary scholars lean toward recommending the silver nisab specifically for cash and mixed wealth, on the reasoning that a lower threshold means more people qualify to pay zakat and more wealth reaches those who are eligible to receive it, which aligns with the underlying purpose of zakat as a redistributive obligation. Using the gold nisab is not incorrect; it simply results in a higher bar before zakat becomes obligatory. What matters is applying one standard consistently rather than switching between the two depending on which gives a more convenient answer in a given year.
Zakat on cash is not due the moment your balance crosses nisab. It becomes due once a full lunar year (hawl), roughly 354 days, has passed while your zakatable wealth has remained at or above the nisab threshold throughout. If your savings dip below nisab at some point during the year and later climb back above it, most scholars hold that the hawl restarts from the date your wealth returned to or above the nisab level, rather than continuing to count from the original start date. This is one of the main reasons record-keeping matters for anyone whose balance fluctuates through the year, since the exact date your wealth first reached nisab determines your annual due date going forward.
Once nisab and hawl are both satisfied, the calculation itself is straightforward: zakat on cash and savings is 2.5% (one-fortieth) of the total zakatable balance on the date the hawl completes. Add every qualifying cash holding together first, checking, savings, physical cash, foreign currency converted to your home currency, and any deductions covered below, then multiply the final total by 0.025. You can find a fuller explanation of this specific point in How to Track Your Zakat Payments Every Year.
Money that others owe you is generally treated as part of your zakatable wealth, but the details depend on how likely you are to actually collect it. A debt you fully expect to be repaid, such as a short-term loan to a reliable friend or a client invoice that will clearly be paid, is typically included in your zakat calculation each year exactly as if the cash were already in your account. A debt that is doubtful or contested, where repayment is genuinely uncertain, is more commonly excluded from the annual calculation by many scholars, with zakat on that amount only becoming due (for the years it was outstanding, in some views, or just the year received, in others) once it is finally collected. When in doubt about a specific receivable, it is worth raising the case with a knowledgeable local scholar rather than guessing either way. You can use the Cash & Savings Zakat Calculator to get the result instantly, with no manual math.
Before applying the 2.5% rate, most scholars allow deducting debts that are due imminently, this month's rent, a utility bill, a loan installment that is due shortly, from your cash total. The reasoning is that this money is effectively already committed and not genuinely available wealth at the moment zakat is calculated. Long-term debt with no payment due in the near term, such as the remaining balance on a decades-long mortgage, is generally not deducted in full; only the portion currently due is typically subtracted. This distinction matters most for people carrying a mortgage or a long personal loan alongside their savings, since deducting the entire outstanding balance would eliminate zakat obligations for almost everyone with any kind of long-term debt, which is not the position most scholars hold.
If a savings or checking account has generated interest, that interest is not zakatable income in the ordinary sense, and more importantly it is not considered permissible wealth to keep at all. The accepted approach is to identify the interest amount separately from the account statement and give the full interest amount away, typically to non-religious charitable causes rather than as sadaqah expecting reward, without counting it toward your zakat payment. Only the principal savings amount, the money you actually deposited or earned through permissible means, is included in the zakatable total. Keeping funds in profit-sharing or interest-free accounts avoids this extra step entirely. If you want to go further, Zakat on Stocks and Investments: How to Calculate What You Owe explains this point in more depth.
Consider someone with the following position on the date their zakat year completes:
Total zakatable cash: $12,000 + $3,000 + $500 + $500 − $800 = $15,200. Assuming this figure is above the applicable nisab threshold on that date, zakat due is $15,200 × 0.025 = $380.
If your cash is split across more than one currency, convert every amount to a single reference currency using the market exchange rate on the date your zakat year completes, then add everything together before applying nisab and the 2.5% rate. There is no need to calculate zakat separately per currency; the goal is a single combined total in one currency so the nisab comparison and final percentage are both accurate. Rather than working this out by hand every time, the Cash & Savings Zakat Calculator can handle the whole calculation for you.
A common question is whether money set aside for a specific upcoming purpose, a house deposit, a wedding, an upcoming Hajj trip, or a business reserve, is exempt from zakat simply because it has already been earmarked. It is not. The intention to spend money in the future does not remove it from your zakatable wealth in the present; only money that has genuinely left your possession, an upfront non-refundable deposit already paid, for example, stops counting. This applies even to funds held in a separate "savings goal" account or sub-account inside a banking app; the label attached to the money does not change its zakat status, only its actual location and ownership does.
The one situation that does change the calculation is when money has already been paid out as a binding, non-refundable commitment before your hawl completes, such as a signed and paid property deposit that cannot be recovered. In that case, the money has genuinely left your wealth and is no longer yours to include. Simply intending to spend it soon, without having actually paid it out, is not enough on its own. It's also worth reading Zakat on Business Assets: How to Calculate Zakat on Trade Goods if this situation applies to you.
It is worth being clear about a distinction that confuses many salaried employees: zakat is not a tax on income as it is earned. A monthly salary is not itself zakatable the moment it is deposited; what matters is the balance that remains in savings once a full hawl has passed while that wealth stayed at or above nisab. This means that money spent on ordinary living expenses throughout the year, rent, groceries, transportation, never becomes part of the zakat calculation at all, since it never survives as accumulated wealth. Only the portion of income that is actually saved and held is relevant, and it is measured as a snapshot on the hawl completion date rather than totalled up from every paycheck received during the year.
Skip the manual addition and nisab lookup. Ihsabha's Cash & Savings Zakat Calculator totals your accounts, applies the nisab standard you choose, and gives you the exact amount due in seconds.
Yes. Any cash you hold, in a checking account, savings account, or physically at home, counts toward zakatable wealth. It does not need to be earning any return, and it does not need to be set aside for a specific purpose to qualify.
Both are valid. Most contemporary scholars recommend the silver nisab (about 595 grams of silver) for cash and mixed wealth, since it is the lower of the two thresholds and results in more zakat reaching those in need. Using the gold nisab (about 85 grams of gold) is also a recognized position.
Yes, the majority view allows deducting debts that are due imminently, such as this month's bills, rent, or a loan installment, from your cash total before applying the 2.5% rate. Long-term debt with no near-term payment due is generally not deducted.
Interest (riba) is not permissible income and should be removed from the account and given away without expectation of reward, separately from zakat, rather than kept or counted as zakatable growth. Only the principal savings amount is zakatable.
Cash zakat only feels complicated the first time through. Once the nisab standard is chosen, the hawl start date is recorded, and any imminent debts are set aside, the remaining step is a single addition followed by a single multiplication. The details worth double-checking each year are the ones covered above: which accounts to include, what to deduct, and what to exclude, rather than the arithmetic itself, which rarely changes from one year to the next.
Put this into practice with Ihsabha's Gold & Silver Zakat Calculator and Trade Assets Zakat Calculator. For related reading on Ihsabha's blog, see Zakat on Cryptocurrency and Bitcoin: How to Calculate What You Owe, Zakat on Salary and Employment Income: How to Calculate What You Owe and Zakat on Retirement Accounts and Pension Funds (401k, EPF): Full Guide.