Zakah is an obligatory pillar of Islam, required from those who meet the nisab threshold. When calculating Zakah, ongoing mortgage payments due within the year can be deducted, but the total mortgage amount does not affect Zakah. This is because mortgage debt is considered a future financial obligation rather than an immediate liability.
The Importance of Zakah in Islam
Zakah is the third pillar of Islam. It is considered a purification of one’s wealth, and it is always correlated with Prayer in the Quran; wherever you read (Perform Prayer) in the Qur’an, it is followed by (And pay Zakah).
Who Is Obligated to Pay Zakah?
It is known that only those who own nisab (the minimum amount requiring Zakah) have to pay Zakah. In calculating Zakah, a Muslim should first deduct all his or her expenses and loans, as these items are not subject to Zakah.
Does Having a Mortgage Affect Zakah Calculation?
You do not deduct the mortgage amount at all. In other words, you add whatever you have of cash, gold or silver, investment, and other Zakatable items on the day of their hawl (passage of 354 days), including any money you just may have earned one day before, deducting all that you have to pay during the month or the period until your next earning (including any amounts coming due during this period on the mortgage and household expenses) and pay Zakah on the rest at 2.5 percent.
Why Future Mortgage Payments Do Not Affect Zakah
The reason is that the rest of the mortgage is in fact a debt on your future income, not on your present property; it is not going to be paid out of the present property.
Almighty Allah knows best.
