Zakat on crops irrigated at expense

Question: What rate of zakat is paid on crops that are watered by mechanical means?

Answer: Crops irrigated by machinery are subject to one-half of one-tenth—that is, five per cent. Everything that is watered at a cost, whether by pumps, waterwheels, or bucket-lifting devices, carries the same rate: one-half of one-tenth.

Zakat on trade goods

Question: I have owned a tract of land for several years and put it up for sale. I sold two-thirds of it and received the price in two instalments; the remaining third I sold on instalment over twenty-eight months. Do I have to pay zakat on it for the previous years up to and including the current year, or not?

Answer: Zakat is obligatory on ʿurūd al-tijārah (trade goods)—that is, commodities offered for buying and selling in pursuit of profit—and land is included in that category. If a person owns plots of land and puts them on the market seeking profit from their price, they become trade goods. Likewise, if someone buys a piece of land and offers it for sale with the intention of making a profit, it turns into a trade commodity.

The questioner purchased a plot of land for trade, kept it for several years, and then sold it for a deferred price payable in instalments. What is required of him?

You must pay zakat for every year that elapsed before the sale. Because you had placed the land on the market and intended to sell it throughout those years, zakat became due each lunar year. At the end of every year you appraise it at its current market value and then pay one quarter of one tenth (2.5 %) of that value.