I have a building that I rent out, and although I would like to sell it if a good buyer came along, is zakah obligatory on it? And if zakah is obligatory on it, I do not have the funds.
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The questioner : The questioner, Ibrahim from al-Madinah al-Munawwarah, has this question. He says: To the honorable Shaykh Muhammad ibn Salih al-Uthaymeen (may Allah preserve him), peace be upon you and Allah’s mercy and blessings. The questioner says: I have a building that I rent out, although I would like to sell it if a good buyer came along. Is zakah obligatory on it? And if zakah is obligatory on it, I do not have the funds at the present time. What is obligatory upon me? Please issue a ruling for us. May Allah benefit you with your knowledge?
The Shaykh : I say, and upon you be peace and Allah’s mercy and blessings. A building that a person prepares for renting out, but if someone comes to him offering a high price, he sells it, has no zakah on the building itself, but rather the zakah is on its rental income.
As for the one who buys a building intending to make a profit from selling it, wanting to sell it and having no intention of keeping it, but saying, “As long as I have not sold it, I will rent it out,” then he has zakah on the building itself, and he also has zakah on its rental income. People distinguish between a real estate dealer who buys and sells real estate to make a profit, and a person who has investment buildings whom wants to invest in them, but if someone comes to him and entices him with a high price, he sells them. The first one has zakah on the buildings themselves and on their rental income, while the second one does not have zakah on the buildings themselves, but the zakah is on their rental income. Yes.
The questioner : May Allah reward you.
The Shaykh : I say, and upon you be peace and Allah’s mercy and blessings. A building that a person prepares for renting out, but if someone comes to him offering a high price, he sells it, has no zakah on the building itself, but rather the zakah is on its rental income.
As for the one who buys a building intending to make a profit from selling it, wanting to sell it and having no intention of keeping it, but saying, “As long as I have not sold it, I will rent it out,” then he has zakah on the building itself, and he also has zakah on its rental income. People distinguish between a real estate dealer who buys and sells real estate to make a profit, and a person who has investment buildings whom wants to invest in them, but if someone comes to him and entices him with a high price, he sells them. The first one has zakah on the buildings themselves and on their rental income, while the second one does not have zakah on the buildings themselves, but the zakah is on their rental income. Yes.
The questioner : May Allah reward you.