According to Dewan Bahasa dan Pustaka, a scholarship is money provided to a student to finance or assist in financing their education.

Scholarships or allowances received by a student do not fall under the category of income assets (al-Mal al-Mustafad) if the amount received is merely sufficient to cover tuition fees and the student’s basic living needs.

However, if the student receives a scholarship or allowance that exceeds the cost of education and personal living expenses, the surplus is considered an income asset. This surplus must be assessed together with other categories of income assets the student owns, and zakat is obligatory if the total exceeds the nisab.

Based on the Selangor State Zakat Collection Management System Fatwa 2017 (Amendment 2023), assets based on the nisab of 85 grams of gold (excluding gold for adornment, including savings and investments) should be combined to determine whether the nisab threshold is met.⁹

If a student saves the scholarship/allowance received and it reaches the haul of one year, the scholarship/allowance becomes a savings asset. It is then subject to zakat under Zakat on Savings, to be assessed together with other savings assets such as gold (not for adornment), investments, takaful savings, and the like.