Zakat is obligated on trade goods (i. e. Any property intended for trade, other than money, be it liquid, an estate, or an animal).

Samura ibn Jundab (G. p. H) said: "The Messenger of Allah (P. B. U. H) used to order us to pay alms on that which we prepare for sale".

[Abu Dawood, Vol. 2, The Book of Zakat, Chapter 2/1562].

This is achieved by assessing the value of trade goods, at the end of a term (It is the selling market price at the time of paying zakat that matters, not the purchase price),in the kind of money it had been bought.

If its value is greater than, or equal to, the nisab, zakat should be paid out.

This zakat should be paid out in cash rather than in goods (Shafu school, all kinds of zakat are paid from the property, on which zakat is payable, itself except for zakat on trade goods which is paid in money).

If one trades in real estate, for example, he should estimate the value of his real estate at the end of a term and pay zakat on its value.

There is no significance to what is sold or bought during a term (There is no zakat on properties, however numerous they are, if they are used for dwelling, or rented out by the owner for profit).

The term of trade goods begins with the first negotiation of a sale accompanied with the intention to trade.

Hence, the term does not begin if one intends to trade but does

not negotiate, or negotiates with no intention to trade.

There is no significance to the value of the goods at the beginning of a term, however large it may be Rather, it is the value at the end of the term that matters.

If the goods are exchanged for the money with which it was bought during the term and the amount of this money was greater than the nisab, the term will not be interrupted, otherwise it will.

If one buys, with this money, another type of goods the term will be interrupted.

Estimating the value of trade goods can only be done in the kind of money with which they were bought.

Hence, if one buys some goods with gold, he should estimate their value in gold, and if he buys them in silver he should estimate their value in silver, and if he buys them in both gold and silver he has to estimate the part bought by gold separately and the part bought by silver separately.

The two cannot be added to each other, hence, if the amount of each of them is less than that on which zakat is payable, no zakat is obligated on them, even if it reaches the zakat-payable amount in another type of currency. (pa: 332)

If goods come into one's possession by exchange, (such as

exchanging them for other trade goods), payment for marriage, or indemnity for blood, it should be estimated in the common type of money of one's homeland.

The amount of zakat on goods is one quarter of the tenth (2. 5 percent). Zuraiq ibn Hayan, who was in charge of the borders of Egypt at the time of Al-Walid ibn Abd Al-Maiek and Sulaiman and Umar ibn Abd Al-Aziz, mentioned:

"Umar ibn Abd Al-Aziz wrote to him to observe those Muslims he comes into contact with, and take one dinar out of every forty dinars out of their visible properties, which they are using for trade.

Anything less, down to twenty dinars, is calculated accordingly.

If they are one third of a dinar less than twenty then leave it and do not take anything out of it".

[Al-Muwatta, Vol. 1, The Book of Zakat, Chapter 9/20]