Answer
Wa `alaykum as-Salamu wa rahmatullahi wa barakatuh.
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
In this fatwa:
What is subject to Zakah for her is: Y+D as D is part of her wealth which she owns and the debtor does not deny this debt and also able to pay it.
In his response to your question, Prof. Dr. Monzer Kahf, Professor of Islamic Finance and Economics at Qatar Faculty of Islamic Studies, states:
Let’s remember that each person, minor or adult, is independent in matters of properties and ownership from each other, even partners and joint husband and wife are considered independent in what they own according to their capital contribution, etc.
Let’s now construct the Zakah balance sheet of you and that of your daughter: in each there may be cash, investment and other zakatable items so that your personal balance sheet appears as follows:
Assets X, liability loan from daughter. Let’s notice that what you got as a loan is either still within your assets e.g. cash still in your pocket or already consumed or used for purchasing any other asset which may be zakatable or not.
In other words, nothing appears in your assets as money belonging to somebody else; the business loan is deductible because in business we only consider total net worth but personal loan is not deductible because in personal matters we look at what you actually have unless this loan is going to be physically paid out of the existing assets.
Let’s now look at the balance sheet of your daughter; her asset has zakatable items such as cash, jewelry and what not amount. Her assets are Y plus a debt on you (this is a recognized debt on a person who is able to pay it back). She may have liability which is treated the same as we treated yours.
What is subject to Zakah for her is: Y+D as D is part of her wealth which she owns and the debtor does not deny this debt and also able to pay it.
Allah almighty knows best.