Zakat on trade goods

Question

Bakr has opened a cloth shop; he brings the goods on credit from a merchant-moneylender, and by selling the goods he pays the merchant-moneylender money little by little. Is there zakat on such trade goods or not? And if there is, how is its zakat to be paid?

Answer

If he has cloth or money to the amount of the nisab of zakat (fifty-two and a half tolas of silver or its value; a tola is a unit of weight, ≈ 11.66 g) in excess of the debt, and a full year passes over it, then its zakat (one-fortieth) is wajib; otherwise it is not wajib.

Source: Fatawa Mahmudiyya

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