Exclusive: “Zakat is not paid on unreceived pension”, Islamic financial guru clarifies

An Islamic scholar, Professor Abdulrazaq Abdulmajid Alaro,mni, has reaffirmed that zakat, the obligatory charity in Islam, is not required on pensions that have not yet been received.

This clarification comes amid concerns from Nigerian retirees, many of whom have waited over a decade for their pension payments.

He said this while responding to questions during the annual Ramadan Tafsir at the As-Sunnah mosque, Ilorin, Kwara State, Nigeria.

The Islamic financial expert emphasized that Islam does not impose financial hardship on individuals. He explained that scholars classify delayed pensions as “uncertain money,” meaning it remains outside the obligation of zakat until it is actually received.

Similarly, Professor Alaro highlighted exemptions for those struggling with debt.

He said, “In Nigeria, many retirees have waited over a decade for their pensions, yet their payments remain uncertain. Islam does not impose financial hardship, and scholars categorize such delayed pensions as “uncertain money.” If the pension is eventually received, zakat is only required for that particular year. “

The university don, who is a senior lecturer at the Department of Islamic Sharia Law, University of Ilorin, Ilorin, Nigeria, added that individuals whose debts exceed their expected income or whose debts match their account balance are exempt from zakat.

Addressing concerns about the financial burden of zakat, the scholar reassured that the required amount is minimal. “Zakat is small. It’s just 2.5 percent, and in another case, it is 1/40,” he explained.

Zakat, one of the five pillars of Islam, is an obligatory form of charity where Muslims give out a portion of their wealth (2.5%) to those in need after a full lunar year of possessing wealth above a certain threshold (nisab).

The clarification offers relief to many retirees and Muslims navigating their financial obligations. With many Nigerians facing pension delays, the ruling provides guidance on religious duties, ensuring compliance without undue hardship.