Zakah on value of land.
Mu' meneen Brothers and Sisters,
As Salaam Aleikum wa Rahmatullahi wa Barakatuh. (May Allah's Peace, Mercy and Blessings be upon all of you)
One of our brothers/sisters has asked this question:
How zakat would be calculated on the value of the land. There are two types of values. 1) Government Value and 2) Market Value. Both the values differs.
So my question is, Shall we calculate zakat based on the current Government Value or the current Market Value?
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Zakah on value of land
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Zakah in Islam will be determined at 2.50% of the fair market value of the excess asset at the end of each lunar year.
If the land one owns is agricultural land, then there is zakah on the value of the land, but rather zakah will be determined annually on the produce from the land..10.00% of the produce of the land if the land is irrigated by natural means (rain, etc.), and 5.00% if the land is irrigated by artificial means (wells, tubes, etc.).
But if the land in question has been purchased as an investment, then the annual zakah will be determined at a fair market value of the land at the end of each lunar year.
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Your brother and well wisher in Islam,