Is zakat obligatory on a house prepared for sale or investment after it was for dwelling?
A house previously designated for dwelling is not subject to . However, now, the ruling on zakat is determined by the intention to sell or to construct a commercial building:
- If the decision is settled on selling and the means for doing so are pursued, the house becomes a trade commodity, and zakat is obligatory on its value each year upon the completion of its hawl (zakat year).
- If the decision is settled on constructing a commercial building, there is no zakat on the building itself. Rather, zakat is due on the rental income if it reaches the (minimum threshold) and a hawl has passed over it.
- If the intention to sell arises after the construction of the commercial building, the building becomes a trade commodity after its completion and offering for sale, and zakat on it is obligatory as zakat on trade commodities.
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