QUESTION:

When you have a children’s bond account do you have to pay zakat on the total money we put in or on what the account is worth?

ANSWER:

In the name of Allah, Most Compassionate, Most Merciful,

These bonds are no longer available. When they were available or if other such bonds are still available, investing in them would be impermissible because of them being interest-based.[1]

As for zakāt being compulsory on such bonds, if the ownership of the money is transferred to the child in such a manner that the parent or guardian can no longer receive or claim the money for themselves, then zakāt would be compulsory on the child if the child has reached the age of puberty and other conditions that make zakāt compulsory are fulfilled.

If zakāt is compulsory, it would be compulsory on the amount paid in the account for the bonds, and not on the interest received because interest is impermissible.

And Allah, the Almighty, knows best

Mufti Sufyan

[1] https://www.moneyadviceservice.org.uk/en/articles/childrens-bonds