Posted: 19 Ramadan 1423, 24 November 2002
| Zakat On Income From Sale of Property
Q.) I always calculated zakat on my total asset at the beginning of Ramadan every year. I paid zakat even when the asset was in my possession for less than a year. Keeping this in mind I have this question: I acquired money after selling off my house this year in March 2002. I will be Insha-Allah buying another house soon. Do I need to pay zakat on this money this Ramadan? But, if I am not able to buy the house by March (i.e. after one year of having the money) but bought it in say June, then do I pay zakaat and when?
A.) As usual you have to pay zakat on the proceeds of your house this Ramadan. And Allah Ta’ala Knows Best
A.) Zakat must be given to the poor and needy. Zakat cannot be used directly for constructing a madrassa or an orphanage.
You should give out your zakat personally to the poor and needy who are eligible to accept zakat. If you choose to give your zakat to an organization make sure that there are competent Ulama there who are well versed in the laws of Zakat. You should not give your zakat to an organization where there are no reliable Ulama and the organization is not well versed in the laws of zakat. If they did not discharge your zakat according to Shariah, your zakat obligation will not be fulfilled. And Allah Ta’ala Knows Best
A.) In principle, the prerequiste for discharging zakaat is tamleek (making the needy owners of the zakaat). (Hidaayah)
If a person hands over his zakat to the organization and the zakat gets used in the operating costs without making a needy person the owner his /her zakat will not be considered as discharged. Therefore people should be extremely cautious as to whom they hand over their zakat. And Allah Ta’ala Knows Best
A.) Zakat is not payable on the actual property if it was not acquired for resale. Zakat is only levied on the income received. Your Zakat on the income received will be calculated as follows: Cash on hand less current liabilities (like annual bond repayments, rates, etc.) Zakat is payable on the balance. You may not deduct expenses which you think may fall due during the course of the year – like maintenance, etc. And Allah Ta’ala Knows Best