AskImamDarul Iftaa Mahmudiyyah (AskImam)

If I buy a residential plot with the intention to sell if for a profit, do I have to pay zakah on the land?

Fatwa 13670English
FastingRamadan

Question

If I buy a residential plot with the intention to sell if for a profit, do I have to pay zakah on the land?

Should I pay zakah on the original price I paid or on the market value of the land? If I bought the land on monthly installments, should I pay the zakah from the time I made the first installment or from the time I made the last installment and took the full possession

Answer

1. If you purchased the land with the intention to resell it, then the land is Zakaatable.

2. The Zakaat on the land may be calculated according to the purchase price. If the market value is higher, that will be advisable as that will be more beneficial to the poor.

3. Zakaat will be payable only upon paying the last instalment.

and Allah Ta'ala Knows Best

Mufti Ebrahim Desai

Answered by
Mufti Ebrahim Desai
View original Ask AskImam directly

Fatawa SA is an independent, read-only index of fatawa already published by Darul Iftaa Mahmudiyyah (AskImam). It is not a fatwa service. For your own situation, ask the issuing Darul Ifta directly.