Question: Assalamualaikum Shaik,
I have one question on Zakat.
Recently I have purchased some property. Do I need to give zakat on the property value?
I have read in some islamic sites that we dont need to pay the zakat on property if we have intention of living in it. But if we have the intension of making money on it as kind of investment, then we need to pay zakat on it.
I dont have the intention to leave in it. But I have intention to sell the property to make my future home.
Please clarify me whether I need to pay zakat on it or not?
Jazaka Allahu khairan.

Time: Wednesday September 9, 2009 at 4:32 pm

Answer 1) Property purchased to reside upon would not require one to pay zakat on it.

Investment property would require zakat to be paid upon it. The amount of zakat would depend on the current years market value of the property.

Answer2) Buying property for personal usage and intending to sell it later on would require for you to evaluate the following: if the intention is for personal usage, then no zakat obligation would remain on you. If it was purchased as an investment to sell later on, zakat would be due. It seems like you have opted for the latter. Thus, in your scenario, zakat would be necessary. Should your intention change, so would the requirement for zakat.

Allah Certainly Knows Best.