How exactly do you work out how much zakat you have to give on the gold you own?
I understand that you work out the nisab value, and if you have more gold than that, you give 2.5% of the value of the gold you have. I am assuming that is based on the nisab value of 24 carat gold.
However, most people have gold jewellery, and gold jewellery is normally 22 carat gold, as 24 carat gold is too soft to make into jewellery.
So how does it work?
Am I supposed to find the nisab of 22 carat gold, then give zakat based on how much 22 carat gold I have based on the current value of 22 carat gold on the open market?
Or, to make things even more complicated, is it based on the value of the jewellery? which normally costs a 3rd more than the value of the gold, when when it comes to selling your jewellery, I think the gold merchant is just interested in the value of the gold, so you normally get a 3rd to a half off the value you the jewellery... as I think they melt the jewellery to get pure gold out of it...
So I have no idea how this works when working out zakat.
As ramadhan is approaching, apparently a lot of people like to give their zakat in ramadhan.