Liability of Zakah on Investment

بسم الله والحمد لله والصلاة والسلام على رسول الله

Firstly, how much and what Zakâh is due on an investment depends on the nature/intention of the investment: 1) If it's with the intention to sell, the entire value of the investment is subject to Zakâh as it is treated as trade stock[1].
2) If it's only to gain a profit, then whether you pay Zakâh on the investment or not depends on the type of investment, e.g. -

• rental property or similar: no Zakâh due as it's not a Zakâtable asset;
• shares in a company or similar: Zakâh is due on the Zakâtable assets of the company/investment - cash, gold, silver, trade stock, etc.

There isn't enough information in your question to determine the exact nature, but it seems as if it's only to gain a profit. Use the above guideline to determine whether Zakâh is payable at all on the investment itself.

In addition to the above, Zakâh is also due on any dividends/profits.

Now, on to your question. It's important to note that Zakâh is payable on whatever you possess on your nisâb date (the date when you reached nisâb), not the total income that was derived from your investment.

In other words, no Zakâh is due upon the money that has been spent. If you have deductible liabilities, e.g. debt such as a personal loan, this can be deducted to reduce your Zakâh liability. If your assets minus your liabilities fall below the nisâb figure (see our nisâb tool for more details), no Zakâh will be due at all.

The injunctions in Islam are meant to be easy and not cause difficulty:

"Allâh does not intend to make difficulty for you" [2]

"Allâh does not charge (make responsible) a soul except [with that within] its capacity..." [3]

"Allâh intends for you ease and does not intend for you hardship" [4]

"Verily, the religion (of Islam) is easy..." [5]

and numerous other examples which point towards this principle. Rest assured, Zakâh is only due upon the wealthy (and, that too, only 2.5%) and a person paying his Zakâh should never run into any difficulty in fulfilling his obligation.

And Allâh knows best

Answered by (Abu Yousuf) M. Suhail

[1] فَإِنَّ رَسُولَ اللَّهِ صلى الله عليه وسلم كَانَ يَأْمُرُنَا أَنْ نُخْرِجَ الصَّدَقَةَ مِنَ الَّذِي نُعِدُّ لِلْبَيْعِ "the Messenger of Allah (صلى الله عليه وسلم) used to command us to pay Sadaqah (Zakâh) of those items that we prepared for sale/trade." (Sunan abi Dawud)
[2] ما يريد الله ليجعل عليكم من حرج Qur-ân 5:6
[3] لا يكلف الله نفسا إلا وسعها Qur-ân 2:286
[4] يريد الله بكم اليسر ولا يريد بكم العسر Qur-ân 2:185
[5] إن الدين يسر [Bukhari, Nasa'i]