Zakat on ISAs: Are ISAs Zakatable? (UK Muslim Guide)
Are ISAs subject to Zakat? Yes — cash ISAs, stocks & shares ISAs, and lifetime ISAs are all zakatable. UK guide with calculation examples.
ISAs (Individual Savings Accounts) provide tax-free saving in the UK. But for Zakat purposes, the tax wrapper makes no difference — the assets inside are still zakatable.
Quick Answer
Yes, all ISAs are zakatable. The ISA is a tax wrapper — it doesn't change the Islamic status of the assets inside. Cash ISAs are treated as cash. Stocks & shares ISAs are treated as investments.
ISA Types and Zakat Treatment
| ISA Type | Zakat Treatment | How to Calculate |
|---|---|---|
| Cash ISA | Same as savings | Full balance at Zakat date |
| Stocks & Shares ISA | Same as investments | Market value (see stocks guide) |
| Lifetime ISA (LISA) | Accessible (with penalty) | Full balance minus 25% penalty |
| Junior ISA | Child's wealth | Depends on school of thought |
Cash ISA Example
Mariam has a Cash ISA with £15,000 and a savings account with £5,000.
Both are cash. Total: £20,000. Exceeds Nisab.
Zakat = £20,000 × 2.5% = £500
Lifetime ISA (LISA) — Special Case
A Lifetime ISA has a 25% withdrawal penalty before age 60 (unless buying a first home). Some scholars argue you should only include the net withdrawal value (after penalty) in your Zakat calculation, since that's what you'd actually receive. Others say the full balance counts.
The cautious approach: include the full balance. The lenient approach: include balance minus 25% penalty.
Junior ISAs
Money in a Junior ISA belongs to the child and can't be accessed until they turn 18. The Hanafi school does not require Zakat on children's wealth. Other schools differ — consult a scholar.
Calculate your Zakat including ISAs →
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