How to stop bank zakat deduction in Pakistan: the CZ-50 declaration, who is exempt and the 2027 deadline
Banks deduct 2.5% zakat on 1 Ramadan unless you are exempt or file a sworn CZ-50 declaration at least 30 days before. For Ramadan 1448, file by 9 January 2027.
Work it out with the Zakat calculator →
On 1 Ramadan, banks automatically deduct 2.5% zakat from savings and similar accounts. Non-Muslims are outside this deduction, and a Muslim who wants to pay zakat personally can stop it by filing a sworn declaration (CZ-50) under the Zakat and Ushr Ordinance 1980. The catch is timing: it must reach the bank at least 30 days before 1 Ramadan, which for Ramadan 1448 means by 9 January 2027. How to work out your zakat is covered in how to calculate zakat; this guide is only about stopping the deduction.
When and on what banks deduct zakat
Each year the Ministry of Poverty Alleviation and Social Safety notifies the nisab and the “deduction date”, and the State Bank passes it on to banks. For 1447 the nisab was Rs 503,529: no zakat is deducted from a savings, profit-and-loss sharing (PLS) or similar account holding less than that on 1 Ramadan. The amount deducted goes to the Central Zakat Account at the State Bank. The nisab for 1448 will come in a new notification shortly before Ramadan.
Example: if your savings account holds Rs 900,000 on 1 Ramadan and you have not filed a declaration, the bank deducts 2.5% × 900,000 = Rs 22,500.
Who is exempt
- Non-Muslims: compulsory zakat applies to Muslims. The Federal Shariat Court’s judgment records the government’s position that zakat deducted is refundable on documentary proof that the person is not a Muslim, is not a Pakistani citizen, or had more deducted than was due. A non-Muslim does not file a CZ-50; just confirm with your branch that your accounts are marked as exempt.
- Muslims who file a fiqh-based declaration: section 1(3)(a) of the Ordinance says zakat is not collected compulsorily from a person who files a declaration in the prescribed form that they are a Muslim, a follower of a recognised fiqh (named in the declaration), and that their faith and fiqh do not oblige them to pay zakat in the manner the Ordinance lays down. In Farzana Asar’s case (1991) the Sindh High Court held that this covers a Hanafi follower too, and that a declaration in the prescribed form, filed in time, cannot be rejected; the Supreme Court dismissed the government’s appeal in 1999 (as cited in the Federal Shariat Court’s 2013 judgment).
This is the legal and administrative position. Who owes zakat, and how much, is a religious question to take to a scholar you trust.
Filing the CZ-50, step by step
- Get the format: ask your bank or institution for its CZ-50 format. Typical formats ask for your name, father’s or husband’s name, CNIC number, age, address, fiqh, account number and bank.
- Stamp paper: most institutions ask for it to be printed on Rs 50 stamp paper, but some branches or cities ask for a different value, so check with your bank.
- Two witnesses: two people who know you, with their names, father’s names, CNIC numbers, addresses and signatures.
- Swear it: before a magistrate, oath commissioner, notary public or other officer authorised to administer oaths, in front of the witnesses, and get it attested.
- Submit it: hand the original or an attested copy to every bank or institution where you hold an account or investment. If you have several accounts at one bank, list all the account numbers.
- Get a receipt: a State Bank circular tells banks to acknowledge the declaration by stamping, dating and signing your photocopy. It is your main evidence in any dispute, so keep it safe.
The 1448 deadline
| Date | What happens |
|---|---|
| December 2026 | Best time to prepare and file the declaration |
| 9 January 2027 | Last safe date (30 days before 1 Ramadan) |
| Shortly before Ramadan | Nisab for 1448 announced |
| 9 February 2027 (expected) | 1 Ramadan: banks deduct zakat |
The Ordinance requires the declaration “not less than thirty days” before the deduction date. Ramadan is expected on 8 or 9 February 2027, so filing by 9 January covers both. These dates are also on our money calendar.
National Savings and other investments
| Scheme | What CDNS says |
|---|---|
| Defence Savings Certificates | Zakat deducted at source as per rules |
| Special Savings Certificates | Zakat collected at source as per rules |
| Savings Account | Zakat applicable as per rules |
| Regular Income, Behbood and Short Term certificates; Pensioners’ Benefit Account | Exempt from zakat deduction |
For schemes with deduction, file a separate declaration at the National Savings centre or bank that holds them. Exempt only means the institution does not deduct. The usual CZ-50 format lists shares, units, certificates and other investments as well as bank accounts, but to stop a deduction the copy has to be with the institution that makes it. Work out profits with the National Savings calculator and the bank profit calculator.
If you miss the deadline
- The bank will deduct as usual on 1 Ramadan.
- The Ordinance says zakat collected compulsorily is refunded “in the prescribed manner” to a person who files the declaration within the set period, or any further period the rules allow, and claims a refund. We could not find the current official refund procedure or time limit published anywhere, so make a written request to your bank and keep the receipt.
- File now for next year so it does not happen again.
How to count a bank deduction in your yearly zakat is covered in our zakat guide; work out the full amount on the zakat calculator.
Common mistakes
- Waiting until the last week, when notaries and banks are busiest.
- Filing with one bank when you have accounts at several.
- Opening a new account and not filing a declaration for it.
- Not getting a receipt, or losing it.
- Treating the declaration as a release from paying zakat.
Frequently asked questions
I am not a Muslim. Do I need to file a CZ-50?
No. The CZ-50 is a declaration that you are a Muslim of a particular fiqh, so it is not the form for you. Compulsory zakat applies to Muslims; ask your branch to confirm that your accounts are marked as not liable to zakat. If zakat was deducted by mistake, the government’s position recorded by the Federal Shariat Court is that it is refundable on documentary proof that you are not a Muslim.
Does a CZ-50 have to be filed every year?
The Ordinance does not say a declaration expires, and we could not find an official rule either way. Ask your bank whether it keeps your declaration on file for that account or wants a fresh one, and file a new one with every new account.
My balance is below the nisab. Do I still need a CZ-50?
Banks do not deduct if the balance on 1 Ramadan is below the nisab the government notifies. It was Rs 503,529 for 1447 (2026). The figure for 1448 is announced only shortly before Ramadan, so if your balance is close to that level, filing in time is the safe course.
If I file a CZ-50, do I no longer owe zakat?
Legally, the declaration only stops compulsory deduction under the Ordinance. In its 2013 judgment the Federal Shariat Court said the exemption does not remove the duty of a person who owns the nisab to pay zakat under their own arrangements. Use our zakat calculator to work out what you owe.
Does the CZ-50 also cover National Savings and shares?
Each institution that deducts zakat needs its own copy. Defence and Special Savings Certificates have zakat deducted at source, so give a copy to the National Savings centre or bank that holds them. For shares or fund units, give it to your broker, the CDC or the fund manager.
Calculators for this guide
- Zakat calculatorCalculate zakat on gold, silver, cash, bank savings and business stock, with nisab checked against today's silver or gold price.
- National Savings calculatorAfter-tax profit on Behbood, Regular Income, Defence, Special and Short Term certificates, Pensioners’ Benefit and Savings Account, monthly or at maturity.
- Bank profit calculatorWork out the monthly, quarterly or half-yearly profit on a bank savings account after 20% (filer) or 40% (non-filer) withholding tax.
Sources
- Federal Shariat Court, Shariat Petition No. 24-I of 1990 and connected cases (judgment of 7 January 2013), quoting section 1(3)(a) of the Zakat and Ushr Ordinance 1980
- Ministry of Poverty Alleviation and Social Safety: nisab of Rs 503,529 for Zakat year 1446-47 AH and deduction date (16 February 2026)
- State Bank of Pakistan: BPRD Circular Letter No. 03 of 2026, deduction of zakat at source from savings, PLS and similar accounts
- State Bank of Pakistan: CPD Circular No. 03 of 2013, acknowledgement on submission of CZ-50
- Specimen CZ-50 declaration format under section 1(3) of the Ordinance and rule 20 of the Zakat (Deduction and Refund) Rules 1981 (EFU Life)
- Central Directorate of National Savings: “Tax & Zakat” section of each scheme page
- Ramadan 1448 dates: PakHisaab money calendar estimate from the Umm al-Qura calendar; the Central Ruet-e-Hilal Committee decides the actual date
This guide explains the rules for general information. It is not official, legal or tax advice. Rules change, so check the official source or a qualified professional before acting. See how we check our information.