Zakaah On Property

QUESTION:

Please can you advise on the following set of facts:

1. A property-owning company owns a commercial property which it rents at a market-related rental.

2. There are 8 shareholders who own shares in the company in equal parts.

3. The value of the property is approximately R11 000 000 and there is a bond registered over the property for R9 000 000.

4. Notwithstanding that a bond is registered over the property, the company had cash of R8 000 000 which it paid into the bond account. The funds sit in this bond account and the company pays bond instalments on R1 000 000 only.

5. The company can access the R8 000 000 at any stage as it is an access bond and it can draw on these funds for any purpose it requires.

6. The company further has a current bank account which it uses to collect rental and pay its expenses, and there is an amount of R400 000 in this account which fluctuates as income is generated and expenses and dividends paid out.

7. The company pays dividends to the shareholders when, and in the manner the shareholders decide, from time to time.

8. If a shareholder sells his shares in the company the valuation of his shares is carried out as follows:

a. The market value of the property is determined according to a particular formula in the shareholders agreement which equates to R11 000 000;
b. The cash in the bank is added i.e. R400 000
c. The liability of R1 000 000 owing to the bank is deducted (as you would not take the full liability of R9 000 000 due to the funds in the bond account – if one were to deduct the full R9 000 000 you would add back the R8 000 000 and it would result in the same amount)
d. And the value would be R10.4 million divided by 8
e. Accordingly, each shareholder’s value would equate to R1 300 000, which a shareholder will be paid out if he sells his shares

9. Furthermore, each shareholder contributed R200 000 to the company from their personal funds, reflected as loan accounts due to the shareholders which the company will pay when it has excess funds or when a shareholder leaves.

10. The reason why the company has an excess amount of funds is that it sold its previous property at a considerable profit, it managed to pay out its bond and reserve excess funds for another property.

On which amount is Zakaah due, in light of the above facts?

ANSWER:

From the outset, it is imperative to note that Zakaah is not paid on the value of the property, but rather it is paid on the rental income that the property generates, with the proviso that the property has not been purchased for resale purposes.

Now, coming to the queried scenario. For example, Zaid is one of the shareholders who’s annual Zakaah date is the 10th of Ramadaan. So, on the 10th of Ramadaan, when Zaid will calculate all his Zakaatable assets (i.e. cash at home, cash in the bank, gold, silver, inventory, raw materials, any other savings or investments, loans owed to Zaid, etc.), he will also take into consideration and add the rental income he has accrued up until his Zakaat date. However, as stated in the query that there is a bond of R1 000 000 which is distributed between all 8 shareholders resulting in an amount of R125 000 each. Assumimg that this amount will be paid off within a year, this entire amount will then be deducted from the Zakaatable assets amount as there is no Zakaah on debts. If this entire amount of R125 000 is not going to be paid, then only the amount which will be paid in that one year will be taken into consideration for that Zakaah year.

Moreover, you stated in the query that each shareholder contributed an amount of R200 000 as a loan to the company. This amount will also be added to the Zakaah calculations since it is a loan which the creditor discharges Zakaah on.

In summary, Zaid will calculate Zakaah by adding all his Zakaatable assets including the rentals he collects, deducting the loan portion that he owes in that Zakaat year and adding the loan given to each shareholder to the company.

Note: Zakaah will not have to be given on the entire value of each shareholder’s share, which is R1 300 000 as stated in the query.

If you do require any further clarification, you may revert to us Insha’Allah.

کرایہ پر دی ہوئی زمین پر زکوٰۃ کا حکم:
سوال
اگر کسی نے زمین کرایہ پر دی ہے تو زکوٰۃ کس پر واجب ہو گی؟
جواب
زمین کے کرایہ کی آمدنی بقدرِ نصاب ہو کر اس پر سال گزر جائے تب زمین کے مالک پر زکوٰۃ لازم ہو گی اس آمدنی پر ورنہ نہیں ۔
ملاحظہ ہو در مختار میں ہے:
ولا زكاة على مكاتب ولا ثياب البدن وأثاث المنزل ودور السكني ونحوها وكذا الكتب. قال الشامي: ونحوها أي كثياب البدن الغير المحتاج إليها وكالحوانيت والعقارات. (الدر مع الشامي: ۲/۲۶۴، ۲٦۵، سعيد).
فتاوی دار العلوم دیوبند میں ہے:
جائداد کی قیمت پر زکوۃ لازم نہ ہو گی بلکہ کرایہ کی آمدنی پر جو نصاب کی مقدار کو پہنچ جائے، اور اس پر تنہا یا دیگر رقومِ موجود ہ کے ساتھ سال پورا ہو جائے زکوٰۃ لازم ہو گی ۔ (فتاوی دار العلوم دیوبند: ٦/۱۳۳) ۔
آپ کے مسائل میں ہے:
میرے پاس دو مکان ہیں، ایک میں میں خود رہائش پذیر ہوں اور دوسرا کرایہ پر، تو آیا زکوٰۃ مکان کی مالیت پر ہے یا اس کے کرایہ پر؟
جواب: اس صورت میں زکوٰۃ مکان کی قیمت پر واجب نہیں، البتہ اس کے کرایہ پر جب کہ نصاب کو پہنچے تو زکوٰۃ ہو گی ۔ (آپ کے مسائل اور ان کا حل: ۳/۳۷۱) ۔
واللہ سبحانہ و تعالی اعلم

فتاوی دارالعلوم زکريا – (136 /3)

ALLAH TA’ALA ALONE IN HIS INFINITE KNOWLEDGE KNOWS BEST!

CHECKED AND APPROVED BY:

Mufti Abdul Kader Fazlani

Date: 29 Rabi-ul-Aakhir 1449 / 11 October 2026

CHECKED AND APPROVED BY:

Mufti Yacoob Vally Saheb