Zakaat on investment property
Question
I own a property which I have rented out for 11 months. Prior to renting the property I lived in the property. 1. Do I have to pay zakaat on the property? 2. If yes, is it pay on market value of rental income? 3. If rental income can I deduct direct expenses from the rental income eg. Bond repayments, rates etc?
Answer
Zakaat is not payable on the actual property. Zakaat is only levied on the
income received. Your Zakaat on the income received will be calculated as
follows:
Cash on hand less current liabilities (like annual bond repayments, rates,
etc.) Zakaat is payable on the balance. You may not deduct expenses which
you think may fall due during the course of the year - like maintenance,
etc.
And Allah Ta'ala Knows Best
Fatawa SA is an independent, read-only index of fatawa already published by Darul Iftaa Mahmudiyyah (AskImam). It is not a fatwa service. For your own situation, ask the issuing Darul Ifta directly.