Nisab Explained in Simple Words — What Every Muslim Should Know

If you have ever looked into Zakat, you have probably come across the word "Nisab." It sounds complicated, but it is actually one of the simplest concepts in Islamic finance. This guide will explain Nisab in plain, simple language that anyone can understand. No jargon. No complexity. Just clarity.

What Is Nisab? The Simple Definition

Nisab is the minimum amount of wealth you must own before Zakat becomes mandatory for you.

Think of it as a "threshold" or a "starting line." If your total wealth is at or above this line, you must pay Zakat. If it is below this line, you are exempt from Zakat (and in fact, you may be eligible to receive Zakat).

The concept is brilliant in its simplicity. Islam does not tax the poor or those with very little. Only those who have accumulated meaningful wealth are required to give back. This ensures that Zakat is fair, just, and targeted at those who can genuinely afford to give.

Where Does Nisab Come From?

The Nisab threshold was established by the Prophet Muhammad (PBUH) during his lifetime. He defined two standards.

The Prophet said: "There is no Zakat on less than five awsuq of dates, no Zakat on less than five awqiyah of silver, and no Zakat on less than five camels." (Sahih Bukhari and Muslim)

From this and other narrations, Islamic scholars derived two Nisab amounts:

• Silver Nisab: 200 dirhams of silver = approximately 612.36 grams of pure silver
• Gold Nisab: 20 dinars of gold = approximately 87.48 grams of pure gold

During the Prophet's time, these two amounts were roughly equal in value. A person who owned 612 grams of silver had about the same wealth as someone who owned 87 grams of gold. But over the centuries, gold prices have risen much faster than silver prices, creating a huge gap between the two Nisab values today.

Nisab in Pakistan — Today's Values

Let us see what these amounts translate to in Pakistani Rupees (PKR) at current market rates:

As you can see, the silver standard results in a much lower threshold (PKR 153,090) compared to the gold standard (PKR 1,837,080). This is a massive difference of approximately PKR 1.7 million. So which one should you use?

Gold Standard vs. Silver Standard — Which Should I Use?

This depends on your school of Islamic jurisprudence (madhab):

If You Follow the Hanafi School

Use the silver standard. The Hanafi school (followed by the majority of Muslims in Pakistan, Turkey, South Asia, and Central Asia) uses the silver standard for Nisab. The reasoning is that the silver standard creates a lower threshold, which means more people pay Zakat, and more poor people receive help.

If You Follow the Shafi'i School

Use the gold standard. The Shafi'i school (common in Southeast Asia, East Africa, and parts of the Middle East) uses the gold standard.

If You Are Not Sure

Most scholars — including many Shafi'i scholars — recommend using the silver standard when in doubt. The reasoning is based on the Islamic principle of Ihtiyat (caution): when two valid interpretations exist, the more cautious one (the one that is more likely to fulfill your obligation) should be preferred.

Using the lower threshold also means more benefit reaches the poor and needy in our society.

A Common Misconception: "Nisab Is for Each Asset"

This is one of the most widespread misunderstandings about Nisab. Many people think:

• "I need to own 612 grams of silver before my silver is Zakatable"
• "I need to own 87 grams of gold before my gold is Zakatable"

This is incorrect. Nisab is the threshold for your total combined wealth, not for each individual asset. All your Zakatable assets — cash, gold, silver, savings, investments — are added together and compared against a single Nisab value.

Even though Amina has very little in each individual category, her combined wealth exceeds Nisab, so Zakat is obligatory on all of it.

The Hawl Condition — One Full Year

Owning wealth above Nisab alone does not trigger Zakat. You must also have held that wealth for one full lunar year (Hawl). This is approximately 354 days (not the solar year of 365 days).

The Hawl starts from the day your wealth first reaches or exceeds Nisab. If your wealth drops below Nisab at any point during the year (in the strictest opinion), the clock resets and you start counting from the next time your wealth reaches Nisab again.

However, many Hanafi scholars take a more practical approach: as long as your wealth is at or above Nisab at the beginning and end of the year, minor fluctuations in between do not reset the Hawl. This is the easier position to follow and is widely accepted in Pakistan.

Does Nisab Apply to Debts Too?

No, Nisab does not apply to debts. Instead, debts are deducted from your total assets before you check against Nisab.

How Nisab Has Changed Over the Years

Since Nisab is pegged to the market prices of gold and silver, it changes over time. In Pakistan, both gold and silver prices have generally been rising due to global market trends and rupee depreciation. This means the Nisab threshold (in PKR) has also been rising.

However, the relative standard remains the same — it is always 612.36 grams of silver or 87.48 grams of gold. Only the PKR equivalent changes with market prices.

For the latest Nisab values, visit our dedicated Nisab rates page, which is regularly updated.

Quick Nisab Checklist

Use this simple checklist to determine if you need to pay Zakat:

1. ✅ Are you a Muslim adult of sound mind? → If yes, continue.
2. ✅ Calculate your total Zakatable wealth (cash + gold + silver + savings + investments + receivable loans).
3. ✅ Deduct your total liabilities (debts, outstanding bills, loans owed).
4. ✅ Compare the net amount with Nisab (PKR 153,090 for Hanafi).
5. ✅ If your net wealth ≥ Nisab and you have held it for one lunar year → Pay 2.5% as Zakat.