Thursday, June 16, 2016

Comparison of Zakat and Income tax

WHAT DOES QURAN SAY ABOUT ZAKAT: 

Give the news of bitter very torment to those who save their property and money, and do not give their Zakaat to the poor amongst Muslims (9:34)


HADITH SHARIF: “Protect your property against harm by paying Zakaat.”

★ Zakaat is paid on total saving.
IT is paid on annual income + total saving (except savings under section 80(c))

★ No Zakaat is paid on daily, monthly, yearly expenses.
IT is paid on daily, monthly, yearly expenses as state tax, sales tax, central tax, VAT etc

★ Zakaat is paid on Rs 30,000 or more if saved from an year.
IT is paid on total income should be paid even if there’s no savings or balance is zero or negative

★ Zakaat is one fortieth (1:40) of total savings.
Whereas IT is 10% up to 5 lakhs & 20% up to 10 lakhs. (Leaving standard deduction 2, 00,000)

For a savings of Rs 3 lakhs Zakaat is 7,500.
But IT for 3 lakhs is 30,000

★ Zakaat is not applicable on a person whose debt is more than savings but ther’s no excuse for for IT

★ Zakaat is paid on Lands that are used for business purpose.
Whereas no IT for real estate owners who own land valuing millions of rupees.

Interesting Point to Note:

> We pay tax in the name of VAT, Sales tax,  Commercial tax, central tax, Luxury tax, etc in our daily life expenditure .......

> Later in the year end we pay income tax on all our expenditure for which we paid the VAT, Sales tax,  Commercial tax, central tax, Luxury tax....


This means
→income tax on VAT,
→Income tax on sales tax,
→Income tax on commercial tax..
etc.,

Zakat Infographic
Zakat Infographic

Read more Articles on Zakat








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