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Zakat On Agricultural Production And Expenses Allowed For Deduction
I want to ask. Ulema say that if the water source for agriculture is natural like rain or ponds etc. Than zakat will be 10% and if its artificial like tubewell than its 20%
Secondly i want to know if one acre field produce a crop of worth 150000 for example. And the expense on it is around one lakh. The zakat will be on the whole crop or the remaining 50000. Kindly clarify both questions
Thanks
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2 Replies
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Zakat On Agricultural Production And Expenses Allowed For Deduction
updated 1 year, 6 months ago
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The principle of Sunnah with regards to Zakat on production is as follows:
(i) 5 % on all items which are produced by the interaction of both labour and capital,
(ii) 10 % on items which are produced such that the basic factor in producing them is either labour or capital and
(iii) 20% on items which are produced neither as a result of capital nor labour but actually are a gift of God.
Therefore, the decisive factor in applying these percentages is the presence /absence of capital and labour.
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When production occurs, the zakat becomes due immediately on the gross amount (irrespective of the fact when one actually pays it). The only expenses that can be deducted from gross production/gross receipt are those which are incidental in acquiring ownership of that particular form of means of production and/or are substantial expenses in maintaining/sustaining that particular form of means of production, for example, mortgage payments or lease payments for acquiring ownership of the land which is the means of production itself.
Please refer to the video below from 20:10 to 24:08 and from 25:36 to 25:57
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Please also refer to the video below from 1:15:19 to 1:16:38
https://www.youtube.com/live/apcKbzBbQow?si=gYMAH6DwJDP-2O4a&t=4519
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