Calculating Zakaat On Stock

Generally, a retailer will not sell his goods under the retail market value, hence if his selling price is in accordance with the market value, he will calculate his Zakaat on that selling price and not the cost price. In essence, this means that Zakaat should be calculated on the selling price, i.e. the price that he would expect to acquire when selling the item/s.

There may be some goods in his business that have become redundant and obsolete, resulting in him not even able to sell it at the cost price. In other words, the market value of those redundant items on the retail market may have dropped to below his original cost. In that case, whatever he expects to get on the retail market when selling those items (which could very well be below his cost), that is the price that he will calculate his Zakaat upon in this case.

In conclusion, he will calculate his Zakaat on the amount that he would generally expect to procure when selling those items in the marketplace.