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Zakah on the money by which a piece of land was bought before a lunar year had lapsed

Question

I collected money to buy a house or a piece of land to build a house on. I used to pay the Zakaah of that money every lunar year in the month of Ramadhaan. This year, in the month of Sha‘baan, Allaah The Almighty Granted me success in buying a piece of land with the money I collected. However, the selling contracts were not signed until Ramadhaan, owing to the lengthy legal procedures we had to go through until we had finally concluded the contracts and it was something out of my hands. Is Zakaah due on the money for this year?

Answer

All perfect praise be to Allaah, The Lord of the worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad, sallallaahu ‘alayhi wa sallam, is His slave and messenger.

What you have done of paying the Zakah of the money before you spent it in buying what you need is the correct action since Zakah is due on all kinds of wealth in which it is payable after reaching the Nisaab and the lapse of one lunar year.

After buying this piece of land with the money, the Zakah is no longer due on you once you have concluded the contracts because, since that time, you have owned this piece of land and its price has been owned by its former owner. No consideration is given to the lengthy procedures of writing the contracts that you have mentioned.

This applies if you bought this land for ownership purposes and not for those of trade as understood from your question. There is a consensus among the Muslim jurists that no Zakah is due on property intended for private ownership such as a house. The consensus is reported by many scholars such as An-Nawawi and Al-Wazeer ibn Hubayrah. This is based on the Hadeeth where the Prophet, sallallaahu ‘alayhi wa sallam said, "A Muslim is not required to pay Zakah on his slave or horse." [Al-Bukhari and Muslim]

However, if you bought this piece of land so as to sell it, then you are required to pay its Zakah once a lunar year has lapsed on the piece of land itself.

Allaah Knows best.

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