Short answer
Zakat is 2.5 percent (one fortieth) of your zakatable wealth, such as cash, gold, silver and business stock, once it has stayed at or above the nisab for a full lunar year. The four schools agree on this rate for money. Crops and livestock have their own rates.
Paying 2.5 percent of zakatable wealth each lunar year is fard (obligatory) on every adult, sane Muslim whose wealth reaches the nisab after debts. It is worked out on the total value you hold on your zakat date, not on each item separately.
The four schools agree on this.
Explanation
The rate of zakat on money is one fortieth, which is 2.5 percent. On your zakat date, add up the value of everything zakatable you own: cash at home and in the bank, gold and silver, business stock, shares, and money owed to you that you expect to get back. Subtract debts that are due now. If what is left is at or above the nisab, pay 2.5 percent of the whole amount, not only of the part above the nisab.
The quick way to work it out is to divide the total by 40. If your zakatable wealth is 40,000 in any currency, your zakat is 1,000. Our zakat calculator does the adding up for you.
Zakat is counted by the Islamic (lunar) year, which is about eleven days shorter than the solar year. Keep a Hijri zakat date if you can. Some scholars advise people who use a solar date instead to pay about 2.577 percent, so that the extra days are covered.
The four schools agree on 2.5 percent for gold, silver, cash and trade goods. Other wealth has its own rules: crops (ushr) carry a tenth or a twentieth depending on how they are watered, and grazing livestock is counted by set numbers of animals. Things you use yourself, like your home and car, carry no zakat at all (see zakat on your house and car).
The evidence
Quran, Surah Al-Baqara 2:43
وَأَقِيمُوا۟ ٱلصَّلَوٰةَ وَءَاتُوا۟ ٱلزَّكَوٰةَ وَٱرْكَعُوا۟ مَعَ ٱلرَّٰكِعِينَ ﴿٤٣﴾
And establish prayer and give zakah and bow with those who bow [in worship and obedience].
Zakat is commanded alongside prayer as a duty of every believer.
Sahih al-Bukhari 1454
Sahih... وفي الرقة ربع العشر فإن لم تكن إلا تسعين ومائة ...
"And on silver coins, a quarter of a tenth."
From the written zakat instructions Abu Bakr sent out from the Prophet ﷺ: a quarter of a tenth is 2.5 percent.
Sunan Abi Dawud 1573
Graded sahih... فإذا كانت لك مائتا درهم وحال عليها الحول ففيها خمسة دراهم ...
"If you have two hundred dirhams and a year has passed over them, five dirhams are due on them."
Five out of two hundred is 2.5 percent, and the hadith ties it to the passing of a year.
Where the ruling is recorded
- al-Hidaya, Kitab al-Zakat, chapter on the zakat of silver and chapter on the zakat of gold. One fortieth is due on silver and gold at or above the nisab.
- al-Durr al-Mukhtar with Radd al-Muhtar, Kitab al-Zakat, chapter on the zakat of wealth. Cash and trade goods are zakated at a quarter of a tenth.
- al-Mughni, Kitab al-Zakat, chapter on the zakat of gold and silver. Records the agreement of the schools on the rate.
This answer is pending review by the scholars on our team. Quran translation by Sahih International. Hadith Arabic from the standard editions of the six books and the Muwatta, with gradings as recorded there; the English is our own rendering. Spotted a mistake? Tell us.