Definition

Zakat al-Rikaz refers to the Islamic obligation to pay Zakat on buried treasure, precious metals, or valuable items discovered underground. This form of Zakat requires immediate payment upon discovery, distinguishing it from other annual Zakat obligations, and represents one-fifth (20%) of the total value found.

Key Features/Components

• Immediate Payment Obligation: Unlike annual Zakat, Rikaz must be paid immediately upon discovery, regardless of the Islamic calendar year

• Fixed Rate: The Zakat rate on buried treasure is 20% (Khums), which is higher than most other Zakat categories

• No Nisab Threshold: There is no minimum value requirement (nisab) for Rikaz, meaning Zakat applies to any amount discovered

• Broad Definition: Includes gold, silver, precious stones, ancient artifacts, and other valuable items found buried in land

Application in KSA

In Saudi Arabia, businesses involved in construction, excavation, mining, or land development may encounter buried treasure during operations. The Kingdom's rich historical heritage means archaeological finds are not uncommon during infrastructure projects. Saudi regulations require immediate reporting of significant archaeological discoveries to the Heritage Commission, while Islamic law simultaneously mandates Zakat payment. Companies operating in the Eastern Province's oil fields or engaging in major construction projects in historical areas like Riyadh, Jeddah, or Madinah should be particularly aware of these obligations.

Compliance Requirements

Businesses must maintain detailed documentation of any discovered items, including photographs, valuations, and witness statements. Companies should engage certified Islamic scholars or Zakat consultants to determine accurate valuations and ensure proper calculation methods. All discoveries must be reported to relevant Saudi authorities while simultaneously fulfilling Islamic Zakat obligations. Businesses should establish clear internal procedures for treasure discovery scenarios, including immediate notification protocols and valuation processes.

Common Challenges

Valuation Difficulties: Determining the precise market value of historical or unique items can be complex, requiring expert appraisal services.

Legal vs. Religious Obligations: Balancing government reporting requirements with immediate Islamic Zakat payment obligations while ensuring compliance with both frameworks.

Best Practices

Establish Clear Protocols: Develop comprehensive procedures for treasure discovery scenarios, including immediate notification chains, expert valuation processes, and Zakat calculation methods.

Professional Consultation: Engage qualified Islamic scholars, certified appraisers, and legal advisors to ensure accurate valuations and compliant payment procedures. Cloud accounting platforms like Mezan provide comprehensive financial analysis tools that help streamline Zakat on buried treasure tracking and efficiently manage financial data.

Conclusion

Understanding Zakat al-Rikaz obligations is essential for businesses operating in Saudi Arabia, particularly those involved in excavation or construction activities. Proper preparation and professional guidance ensure both Islamic compliance and adherence to Saudi regulations.

For expert guidance on Zakat on Buried Treasure (Rikaz) calculations and compliance, consider consulting with qualified tax and business advisors.