He has debts of $700. Does he have to pay zakaah on them?

The minimum threshold (nisaab) with regard to cash is the equivalent of the lesser nisaab of gold or silver. The one which is lower in value now is the nisaab of 595 grams of silver. So if the amount of money is equal to the value of 595 grams of silver, then zakaah must be paid on it, when one full hijri year has passed since it came into its owner’s possession. 

Based on this, the money that you have — $700 — is subject to zakaah because it is greater than the minimum threshold. 

Please see the answer to question number 2795. 

If the money that reaches the minimum amount is ‘frozen’ and does not increase or decrease, or if its value is decreasing, or it is decreasing because some is being taken from it, then it is also subject to zakaah, so long as it does not fall below the nisaab and one year has passed since it was acquired. But that which has been spent during the year is not subject to zakaah. The scholars of the Standing Committee for Issuing Fatwas were asked about money that is put in a savings box without anything being added to it, and one year has passed – does zakaah have to be paid on it?

They replied: If the year has passed since it was acquired and it reaches the nisaab, then zakaah must be paid on it. End quote. 

Fataawa al-Lajnah al-Daa’imah, 9/273. 

With regard to the fact that this money was a loan to your mother and brother, in the answer to question number 1117, we have stated that if the debt is owed by someone who is able and willing to pay it off and is not delaying, then zakaah is due on it every year, because it is the same as money that is in the hand of its owner. But if the debt is owed by someone who is poor or is delaying payment, no zakaah is due on it, but in order to be on the safe side, when the owner gets it back, he may pay zakaah on it for one year, even if it remained with the debtor for a number of years. 

And Allaah knows best.