Six common zakat return mistakes — and how to avoid them

Most zakat assessments start with avoidable errors in building the zakat base.

1. 1Deducting assets that aren't deductible. Only specific long-term assets reduce the base; check each item against the regulations.
2. 2Ignoring the new matching rules. Under the regulations for years from 2024, liabilities are added according to the assets they finance.
3. 3Treating provisions as liabilities. Most provisions are now treated as equity.
4. 4Financial statements that don't match the return. Every figure in the return should trace back to the audited or approved statements.
5. 5Missing related-party balances. Balances with owners and group companies need careful treatment.
6. 6Filing late. The return is due within 120 days of year-end, and late filing brings fines and delays your certificate.

Before you file

• Reconcile the return to the financial statements line by line.
• Keep a working paper explaining each addition and deduction.
• Have someone review it who didn't prepare it.

A review before filing costs far less than an objection after an assessment.