How Should I Pay Zakat on Money Received from a Sale?

Answered by Ustadh Sufyan Qufi

Question

I bought land 8 years ago intending to build a house, so I didn’t pay zakat. Later, I decided to sell it for my children’s education and sold it last year. The sale amount has been in my account for 3 months but not a full year. Am I obligated to pay zakat this year?

Answer

In the name of Allah, the Most Compassionate, Most Merciful,

I pray this finds you in the best of states.

Zakat is obligatory (fard) upon every legally responsible (i.e. a sane adult) Muslim who possesses the nisab (minimum zakatable amount) for one whole lunar year. [Maydani, Lubab]

The proper thing to do is to add the money received through the sale of this land to all your wealth. Then, when the date for you to pay Zakat comes, you will pay Zakat for all your wealth, without distinguishing between the money received for the land and money previously owned. [Ibid]

Example: You are in the habit of paying your Zakat on the first Ramadan each year. After receiving the money for the sale of the land, you will have to wait for the upcoming first of Ramadan and pay Zakat for all your wealth.

In the Hanafi School, Zakat is due on a certain date so what you have of Zakatable wealth on that date is what you have to pay. Once you own the net Zakatable minimum your Zakat year starts. For example, on the first of Rajab, you own the net Zakatable minimum, this is when the Zakat year starts. The next year, on that day, Zakat would be due on you if you own a Zakatable minimum, if you own less than that, you do not.

Please see this answer for more details:

The Fiqh of Zakat: Nisab, The Lunar Year, Advance Payments, and The Hashimi 

And Allah knows best.

Wassalam
[Ustadh] Sufyan Qufi
Checked and Approved by Shaykh Abdul-Rahim Reasat 

Ustadh Sufyan Qufi is an advanced seeker of knowledge, originally from Algeria, who grew up in France. He began searching far and wide for answers to the fundamental questions of life and was disappointed at the answers he found. Then he connected with various traditional teachers and gradually connected with SeekersGuidance. He embarked on his journey of learning through the various teachers at SeekersGuidance, including his mentor Shaykh Faraz Rabbani. He studied numerous texts in Islamic Law, Theology, Hadith, and other areas with Shaykh Faraz Rabbani and other teachers, including Shaykh Abdurrahman al-Sha‘ar, Shaykh Ali Hani, and others. He is an active instructor at SeekersGuidance and answers questions through the SeekersGuidance Answers Service.