Zakat on Gratuity

Short answer: No zakat before the gratuity reaches your hand — during service it is not wealth you own, only the employer's promised liability, whose amount is not even final. From the day of receipt it becomes cash wealth, zakated after nisab and hawl. No back-zakat for the service years. Details: Zakat requires complete ownership. Before approval and payment you can neither claim nor spend the gratuity, and its amount depends on tenure and final salary. It is therefore future wealth; the reckoning starts upon possession. The easiest method afterwards is to fold it into your existing annual zakat day. Evidence: Quran 9:103 ('from their wealth' — inapplicable before ownership); Ibn Majah 1792 (hawl); the principle applied by the Permanent Committee and contemporary scholars to end-of-service benefits. For complex individual cases, consult a qualified scholar.