DiscussWorldIssues - Socio-Economic Religion and Political Uncensored Debate - View Single Post - Very detailed questions about Zakah on Land

**FelikTen** · 12-05-2011, 11:56 AM

Ok, here is what I want to do:

I want to buy the land from a Real Estate Company by paying the full amount all at once (forget the payments-by-instalments). After some time, I intend to invite a Developer to build a set of apartments on this building. As part of the deal, no money will exchange hands. I will retain 50% of the apartments and give the rest to the Developer. I intend to rent out these apartments eventually or maybe even sell them.

Question A: Is the land zakatable until the apartments are built?
Question B: You mentioned that zakat is paid on the entire amount which is absolutely correct. If the land is zakatable, how do I arrive at the current market price? Is this what I can sell it at or the original seller (Real Estate Company) can sell it at?

NB: Answers don't have to come from a Shafi'i perspective. From what I have been told, Hanafi fiqh seems to be way more developed in mu'amalaat.

Jazak Allah Khair.

I believe most of the issue is answered in my above post. The current price is the current resale price. I am not familiar with the two methods of market evaluation you have mentioned, but I am pretty sure one can make a pretty good estimate as to the current resale price.

As for whether or not the property is zakaatable asset it will depend upon whether or not it is considered a sale to the developers or a payment in lieu of service. As I have mentioned regarding this you should consult a scholar, but without looking at the contract my personal opinion/guess would be it is a payment and not a sale and therefore the property would not be zakaatable since you are not sure if you want to rent them out or sell the units. If you are sure you will sell the units or at least some of the units then also you should consult someone (scholar), but I am assuming part of the value would be zakaatable.

However as mentioned if it is a payment then it will not be zakaatable, but whether or not such a payment arrangement can be made is also questionable. I believe there is some prohibition regarding such a payment arrangement. You should check with someone.

Your deferred payment issue is also addressed in the previous post.

At least the issues are now clear and you can ask proper question to the scholars.

12-05-2011, 11:56 AM	#11
FelikTen Join Date Oct 2005 Posts 441 Senior Member	Ok, here is what I want to do: I want to buy the land from a Real Estate Company by paying the full amount all at once (forget the payments-by-instalments). After some time, I intend to invite a Developer to build a set of apartments on this building. As part of the deal, no money will exchange hands. I will retain 50% of the apartments and give the rest to the Developer. I intend to rent out these apartments eventually or maybe even sell them. Question A: Is the land zakatable until the apartments are built? Question B: You mentioned that zakat is paid on the entire amount which is absolutely correct. If the land is zakatable, how do I arrive at the current market price? Is this what I can sell it at or the original seller (Real Estate Company) can sell it at? NB: Answers don't have to come from a Shafi'i perspective. From what I have been told, Hanafi fiqh seems to be way more developed in mu'amalaat. Jazak Allah Khair. I believe most of the issue is answered in my above post. The current price is the current resale price. I am not familiar with the two methods of market evaluation you have mentioned, but I am pretty sure one can make a pretty good estimate as to the current resale price. As for whether or not the property is zakaatable asset it will depend upon whether or not it is considered a sale to the developers or a payment in lieu of service. As I have mentioned regarding this you should consult a scholar, but without looking at the contract my personal opinion/guess would be it is a payment and not a sale and therefore the property would not be zakaatable since you are not sure if you want to rent them out or sell the units. If you are sure you will sell the units or at least some of the units then also you should consult someone (scholar), but I am assuming part of the value would be zakaatable. However as mentioned if it is a payment then it will not be zakaatable, but whether or not such a payment arrangement can be made is also questionable. I believe there is some prohibition regarding such a payment arrangement. You should check with someone. Your deferred payment issue is also addressed in the previous post. At least the issues are now clear and you can ask proper question to the scholars.
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