Question Summary:
Zakat on Wealth Encompassed by Student Loans

Question Detail:

 
I have a question pertaining to zakat:
1. I took out student loans whilst at university, which now amounts to £13000, which is payable once i earn over £15k. I have currently a total of £7000 in cash and in my bank. I do not earn 15k at present, so therefore i am not paying the loan off. Question is do i have to pay zakat?
2. I have been paying zakat over the past 5 years although i think i have been in a similar situation like what i have mentioned above. Is it wrong that i have been paying zakat? I was paying zakat on the assumption that due to the loan is not to be paid until i earn 15k, its not necessary to consider it as debt.

Answer :

In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.
 
In principle, deferred liabilities will not prevent the obligation of Zakat[1]. Since your liability of £15k is not payable at present, it will fall under the ruling of "deferred liabilities." Accordingly, you are liable to discharge Zakat on the £7000 in cash and at the bank.    
Your discharging of Zakat for the last five years is correct.
If the student loan is based on interest, you should make Tawbah and Istighfar for involving yourself in interest.
And Allah Ta’āla Knows Best
Hisham Dawood
Student Darul Iftaa
Chicago, U.S.A.
Checked and Approved by,
Mufti Ebrahim Desai.
www.daruliftaa.net