Gold Buying, Sarafa Markets & Jewelry Guide for Medina (Madinah)
Historic goldsmith quarter near the Prophet's Mosque specializing in high-purity gold gifts and traditional Islamic jewelry. Saudi Arabia is the largest gold consumer in the Arab world. Pure investment gold bars (99%+) are zero-rated for VAT, while retail jewelry in 21K and 22K is widely gifted during religious pilgrimages and weddings.
When buying gold jewelry in Medina (Madinah), always distinguish between raw bullion value and finished jewelry cost. Finished jewelry carries additional craftsmanship making charges (typically 7%) and applicable local sales tax (VAT (15% on retail jewelry, 0% on 99% pure bullion)). Always demand an itemized digital receipt specifying the net gold weight, gross weight, karat hallmarking certification, and stone deduction.
Hallmarking & Purity Testing
Always verify the official karat stamp or laser hallmark on jewelry (e.g. 916 for 22K, 875 for 21K, 750 for 18K, 999 for 24K bars). Request an electronic density or XRF spectrometer test before purchasing high-value pieces.
Craftsmanship Making Charges
Standard casting jewelry carries lower making charges (6–8%), whereas elaborate antique, Kundan, polki, or meenakari bridal jewelry can range from 10% to 15%. Making charges are negotiable at major Sarafa bazaars.
Islamic Zakat Nisab on Gold
The classical Shariah Nisab threshold for gold is 7.5 Tolas (87.48 grams) of pure gold (approx. SAR 28,970 in Medina (Madinah) today). Holding wealth above this threshold for a full lunar year obligates 2.5% Zakat.