How does an asset become a Zakatable business asset?
A: The Zakat treatment for business assets is principally based upon the intention at the time of purchasing an asset or stock. Assets purchased to resell are Zakatable business assets.
All four schools of jurisprudence agree that for a business asset to be Zakatable, an intention to resell that asset must be present at the time of purchasing that asset.
The majority of scholars assert that an intention to resell must coincide with a commutative transaction like a sale. An intention to resell which coincides with non-commutative transactions like gifting and inheritance will not make an asset a Zakatable business asset.
A business asset will no longer be Zakatable if a person changes his mind about selling the item and stops trading that asset.
Personal items up for sale will not be Zakatable whilst on the market. Only the net cash from the eventual
sale on one’s Zakat anniversary is Zakatable.
And Allah knows best!
Mufti Faraz Adam
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