Khums

One of the economic responsibilities of the Muslims is to pay the Khums; which means that on certain items, 1/5 or 20% (of the value of that item) must be paid to a Mujtahid, which will be used for specific purposes.

1. Khums is Wajib on seven things:

1. Profit or gains from earnings
2. Minerals
3. Treasures
4. Spoils of war
5. Gems that have been obtained from the sea by diving.
6. The Halal wealth which is mixed with Haram wealth.
7. The land which a Kafir Dhimmi[1] (A non-Muslim living under the protection of the Islamic Government) purchases from a Muslim.

2. Just like Salat and Fasting, the paying of Khums is one of the Wajibat, and anyone who possesses one of the seven things listed above, must act according to that which will follow (in relation to the paying of Khums).

One of the instances of Khums that include most people in the society is giving Khums on that which exceeds a person and his families’ yearly expenses (benefit/profit from working). Islam respects a person working and earning, and thus places preference over securing one’s needs over that of paying the Khums. Therefore, one who can secure his (financial) needs from his earnings, if after securing his (financial) needs nothing remains at the end of the year, then Khums will not be obligatory on him.
But, if after calculating all the normal expenses for his life (and the maintenance of his family) according to his (social) status and needs, and without being extravagant or miserly, if something remains at the end of the year, then 1/5 (or 20%) of that which remains must go towards the specified expense (of Khums), and 4/5 (80%) of the amount that is left can be put into one’s savings.