Zakat on a Plot of Land
I live with my family in my late father's house and am settled, alhamdulillah. I purchased a plot of land with mixed intentions — primarily to preserve the value of my money from declining, but I may also sell it in the future or possibly build and live on it. The land is currently unoccupied.
Is Zakat due on it? And if so, is it due every year or only once?
May Allah reward you.
Wa alaykum as-salam wa rahmatullahi wa barakatuh,
In cases of mixed intentions, what matters is the primary intention at the time of purchase.
— If the primary intention was to preserve the value of money or to sell in the future at a higher price, this falls under saving or trade, and Zakat is obligatory in both cases. It is calculated based on the quick-sale value of the land, and 2.5% is due every year as long as it remains in this state.
— If the land is being rented out, Zakat is due on the total annual rental income, not on the value of the land itself.
— If the intentions were genuinely mixed and included the intention to build and live on it, to the extent that you cannot identify which intention was primary at the time of purchase, then no Zakat is due on the land.
And Allah the Almighty knows best.