Zakat on crypto in New Zealand is 2.5% of the New Zealand dollar market value of every coin or token you hold as money or as a trading asset, measured on your zakat date, once your total zakatable wealth sits above the nisab. That is the position most contemporary scholars take for bitcoin, ether and stablecoins, whether they classify them as currency or as trade goods, because both routes land on the same number. Tokens held to use a service rather than to resell, and NFTs kept for personal use, are the contested cases. Inland Revenue already requires New Zealand holders to keep NZD-valued records of every cryptoasset transaction for seven years, and that bookkeeping is exactly what zakat needs. The wider method is on the zakat hub.
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Is crypto zakatable at all? The three positions
The first and largest position treats a cryptocurrency as a medium of exchange, like foreign currency held in a drawer. Currency is zakatable at 2.5% of its value on the day, with no deduction for what you paid, so a holder who bought bitcoin at any price pays on what it is worth now. The second position treats crypto as trade goods, urud al-tijarah, on the ground that most people hold it to sell at a profit. Trade goods are also zakatable at 2.5% of market value on the zakat date, so the arithmetic is identical; the difference is that an item genuinely held for use rather than sale would be exempt under this reasoning. The third position holds that crypto is not valid wealth at all. The scholars who say that do not tell you to pay zakat on it; they tell you to get out of it, which is the debate covered in our verdict on whether crypto is halal and on the is crypto halal hub.
Payment tokens, security tokens, utility tokens and NFTs
Inland Revenue's own description of what cryptoassets are lists three kinds, payment tokens, security tokens and utility tokens, and notes that the sector has no standard terminology. That taxonomy maps neatly onto zakat. A payment token such as bitcoin or a stablecoin is treated as currency. A security token that represents a claim on a business or its income is treated like a share, with the two methods set out in our guide to zakat on shares and managed funds. A utility token bought to access a service and actually used that way is, on the trade goods view, more like a prepaid voucher than wealth, and many scholars exempt it until it is held for resale, at which point it is zakatable at market value.
| Token type | Zakat treatment | Valuation on the zakat date |
|---|---|---|
| Payment token (bitcoin, ether, stablecoins) | Zakatable like currency | NZD market price at a fixed time on the day |
| Security token | Zakatable like a share | Market value, or underlying zakatable assets if you use that method |
| Utility token held for use | Contested; often exempt until held for resale | Market value once it is held to sell |
| NFT held for personal use | Not zakatable, like a personal possession | None |
| NFT or token held for trading | Zakatable as trade goods | Market value, conservatively if the market is thin |
| Tokens on an exchange that has frozen withdrawals | Treated like a doubtful debt by many scholars | Pay when recovered, for the years missed or one year, per your scholar |
Valuing holdings in NZD on the hawl date
Pick one zakat date in the lunar calendar and keep it. On that date, at a fixed time you record, take the price of each asset from the exchange you use and convert to New Zealand dollars. If your exchange quotes in US dollars, use the same exchange rate source every year, note it, and keep the screenshot. Tokens that are staked or locked are still yours and still count at market value; the lock affects liquidity, not ownership. Coins in a wallet whose keys you have lost are, on the majority view, like lost property: not zakatable while inaccessible, and zakatable again when recovered, with scholars differing on whether the missed years must be paid.
Debts can be deducted on the view your scholar follows, usually those falling due within the coming year. Do not deduct what you originally paid for the coins, and do not wait for a better price. The obligation attaches to the value on the day, and a fall in price the following week does not reduce it any more than a rise would increase it.
Staking rewards, lending yields, airdrops and mined coins
Two questions arise with crypto income: whether it is permissible, and how zakat treats it. On permissibility, a reward for validating blocks in a proof-of-stake network is a payment for a service and most scholars accept it, provided the underlying token is itself acceptable. A fixed yield paid for lending your tokens to an exchange or a protocol looks like a return on a loan, which is riba, and IRD's own pages describe it as cryptoasset 'interest' with the word in quotation marks. Avoid the lending products and treat any such income already received as money to give away without reward. Airdrops received without any service rendered are a gift and are clean; airdrops paid for promoting a project are a fee and depend on what you promoted.
On zakat, rewards simply join the pool. Whatever tokens you hold on the zakat date are valued and taxed at 2.5%, however they arrived. On tax, IRD is specific. Its page on acquiring cryptoassets to sell or exchange includes an example in which reward income is income twice: taxable when received, and then the profit on sale is income again with the cost set at the amount already taxed. Its airdrops page says receipt is taxable if you have a crypto business, received it under a profit-making scheme, provided services for it, or receive airdrops regularly, and that disposal is taxable in many cases. Its mining page says rewards are taxable in most cases and that the mining service is zero-rated for GST because it is supplied to a ledger outside New Zealand.
Why IRD's cryptoasset rules are your zakat ledger
IRD treats cryptoassets as property, and its position on purpose is strict: if you acquired a cryptoasset with the main purpose of selling or exchanging it, the profit is taxable, and calling it a long-term investment or a hedge against inflation does not change that because sale is still how you realise the goal. Its worked example about a holder called Leena, who held for three years as a long-term investment and sold at a profit, concludes that she acquired for disposal and must pay tax. Moving coins between wallets you own is not a disposal; exchanging one coin for another, spending crypto, or giving it away is. Most New Zealand holders therefore already have taxable events and an IR3 return to file.
- The type of cryptoasset and the date of each transaction, which gives you the holding on any zakat date.
- The type of transaction, received or disposed of, and the number of units, which separates rewards from purchases.
- The value of each transaction in New Zealand dollars, which is the same NZD valuation zakat uses.
- Total units of each cryptoasset held at the beginning and end of the year, which is a ready-made balance sheet.
- Exchange records, bank statements and wallet addresses, kept for at least seven years even after you sell everything.
- A regular download of your exchange history, because IRD warns that exchanges may keep records only briefly or may cease to exist.
Run the zakat valuation from the same spreadsheet or the same crypto tax software you use for IRD, adding one row for the lunar date. IRD notes that many such calculators are overseas products and that you must make sure they account for transactions under New Zealand law; the same caution applies to zakat, since no tax tool knows your nisab or your madhhab.
A hypothetical worked example against the nisab
Every figure here is invented to show the method. Suppose that on your zakat date the NZD value of your bitcoin is $18,400, your ether $7,600, your stablecoins $4,900, and staking rewards received during the year and still held $300, a total of $31,200. Add your other zakatable assets, such as cash, shares and gold, and subtract debts due within the year if your scholar permits. Compare the total with the nisab, which moves with the gold and silver price and which you should take from our nisab guide in NZD on the day rather than from memory. If the total exceeds it, zakat on the crypto portion is $31,200 multiplied by 2.5%, which is $780, paid in addition to zakat on everything else.
If the same portfolio had been worth $6,000 and you held nothing else, you would compare $6,000 with the nisab on the day; if it fell below, no zakat would be due on it that year, but the hawl would restart only once the total crossed the threshold again and stayed above it for a lunar year on most views. The full treatment of hawl, nisab and the categories is in the complete NZD zakat guide.
Paying zakat in crypto or in NZD
Either is valid; the question is practicality and tax. Selling tokens to pay in New Zealand dollars is a disposal in IRD's framework and may create taxable income if you acquired them for disposal, so record the sale with its NZD value. Transferring tokens directly to a charity that accepts crypto is also a disposal in IRD's list, since giving cryptoassets away is a disposal, and should be valued at the moment of transfer. Confirm in writing that the recipient is eligible to receive zakat and distributes it to zakat-eligible categories, and then confirm it can actually receive the token you plan to send. The organisations that take zakat in New Zealand, none of which is a state system, are set out in where to pay zakat in New Zealand.
Our view: who should do what
If you hold bitcoin, ether or stablecoins as savings or as a trade, pay 2.5% of the NZD value on your zakat date and stop debating classification, because both main positions give the same figure. If you hold utility tokens you actually use, ask a scholar whether your use is real before claiming an exemption. If you have taken lending yields, give them away rather than counting them as yours, and switch to validation-only staking if you must stake at all. If you hold tokens on a frozen exchange, note the value and pay when you recover them.
Whatever you hold, build the IRD record first; it is compulsory, it is in New Zealand dollars, and a zakat calculation is one extra line in it. Facts checked against ird.govt.nz on 16 September 2026.
Frequently asked questions
Is zakat due on cryptocurrency?
Yes, on the majority view. Scholars who treat crypto as currency and those who treat it as trade goods both require 2.5% of its market value on the zakat date, once your total zakatable wealth exceeds the nisab. Only the minority who reject crypto as wealth altogether say no zakat, and they advise disposing of it instead.
How do I work out the NZD value of my crypto for zakat?
Take the price on your zakat date at a fixed time from the exchange you use, convert to New Zealand dollars using a consistent rate source, and record both. IRD already requires the NZD value of every cryptoasset transaction and your opening and closing units each year, so the same records produce the zakat figure.
Do I pay zakat on staking rewards?
Yes, if you still hold them on your zakat date; they are valued with the rest of your holdings. Separately, rewards for validating a proof-of-stake network are generally accepted as a service fee, while fixed yields for lending tokens resemble interest and should be given away. IRD taxes reward income on receipt and again on any profit at sale.
What is the nisab for crypto in New Zealand?
There is no separate crypto nisab. You compare the NZD value of all your zakatable wealth, including crypto, cash, shares and gold, with the gold or silver nisab on the day. The threshold moves with metal prices, so take it from our nisab guide on your zakat date rather than from a figure you remember.
Can I pay zakat directly in bitcoin?
You can, if the recipient is a legitimate zakat distributor and can receive the token. Value the transfer at the moment it is made. Note that giving cryptoassets away is a disposal under IRD's rules, so record it in NZD with your other transactions. Paying in New Zealand dollars after a sale is simpler for most people.
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Does IRD tax my crypto even if I only hold it long term?
Usually yes. IRD says that if your main purpose in acquiring cryptoassets was to sell or exchange them, the profit is taxable regardless of how long you hold, and its own example treats a three-year long-term investment as acquired for disposal. You must keep NZD records for seven years and file an IR3 if you have taxable cryptoasset income.
