Is Zakat Obligatory on Interest Earned from a Bank Account?

Islam strictly prohibits dealing with interest (riba) as stated in the Qur’an and Sunnah. 

Therefore, any interest earned from a bank account is not considered lawful income, and Zakat does not apply.

Here’s what you should keep in mind:

• Interest earnings are not halal and should be avoided whenever possible.
• Zakat is only due on lawful income, so interest is exempt.
• Opt for Shariah-compliant banking to avoid accumulating interest.

What to Do with Interest Money?

If avoiding interest-based accounts is difficult, the interest amount should be disposed of responsibly without seeking spiritual rewards. Otherwise, past interest-based income can affect Zakat payments, leading to miscalculations in the amount due.

Some ways to use it include:

✔ Helping the needy, such as covering medical expenses.
✔ Supporting legal aid for victims who need justice.
✔ Funding public welfare projects like sanitation or community services.

Important Reminder

• This money should never be used for personal benefit.
• Donating it does not bring spiritual rewards, but it removes impure wealth from one’s possession.
• The best approach is to avoid interest-based financial dealings entirely.

By following these steps, one can ensure financial dealings remain ethical and aligned with Islamic principles.

And Allah knows best!

Other Zakat Questions You May Have

• Is Zakat Due on Money Saved for Hajj?
• Is Zakat Required for Wedding Funds Saved by My Parents?
• Is Zakat Obligatory on Money Lent to a Needy Person?
• Is Zakat Due on Money I Intend to Gift in the Future?
• Is Zakat Due on Funds in a Shared Savings Pool or Kitty?
• Is Zakat Payable on a Loan with Delayed Repayment?