Is Zakat obligatory on a piece of land that was purchased with the intention of building on it, but no construction has taken place on it for more than ten years?
Land and real estate are not subject to , unless they are intended for trade and profit, according to the Prophet, peace and blessings be upon him: "There is no sadaqa (zakat) on a Muslim's horse or his slave" (narrated by Al-Bukhari and Muslim).
If you intend to build on the land for housing or rental, there is no zakat on it. Zakat becomes obligatory only on its rental income if it reaches the (threshold) and a full year has passed over it.
However, if you intend to build on it for sale and profit, then it is considered a trade commodity, and zakat is obligatory on it every year according to its value at the end of the year. Its zakat is calculated at a rate of 2.5%.
If you do not have money to pay the zakat, there is no harm in waiting until it is sold, then paying the zakat for the past years.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
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- 13187
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- Text
- Summary from Ftawy's records, reviewed by El Fatwa's sharia committee.
- Read the full ruling
- Read the full answer on Ftawy