Abdur Rahman ibn Yusuf Mangera – Simplified Zakat Guidance Zakatable vs Non Zakatable Assets

Bismillah AR Rahman AR Rahim, the issue I want to deal with in this

particular session is regarding how to determine if something is

for business. Because as we've discussed earlier, and as many of

you know that anything which is considered business inventory,

generally, when we talk about business inventory means that

you're doing like a proper business. And then these, this is

the stock that you hold, however, a person who's not doing a regular

business, but he has some assets for sale. Like, for example,

person's got a old car that he wants to sell, or he's got some

extra

extra furniture that he wants to sell, is that also called a

business asset? Because you're trying to sell it. So it because

business assets are going to be marketable, non business assets

are not the collateral. So what is it that makes an asset, a business

assets, and non business assets, even whether you're doing a

business or not. So if you're doing a business, then it's very

clear to determine that, however, when you're not doing a business,

and it's just something you're selling, once in a while, on

Gumtree spot, Craigslist or whatever, online somewhere, right?

Or to, you know, in a garage sale, or whatever. So now, if it all,

the secret of this, or the basis of this rather, is it all goes

back to how you acquired something? So let's just say that

I've got an old iPad, which I want to sell, now, is this now that I

want to sell it, or I've got a house, which I've moved to another

house, so I've got this house to sell? Do I have to pay zakat on

the value of that house? Right, even before I sell it? Because now

it's considered like a business? Good? So the trick to all of this

to understand this is, how did you acquire it in the first place?

What reason did you acquire that? So if I got this iPad to use write

for myself, if I got the phone to use for myself, which is what

generally happens if I bought the house for use of myself or for

rental, right, which is still a use, right? I didn't buy it to

resell, even though I had a side intention, that if I do get a good

price in the future, sometimes I don't mind sending it as well. But

I didn't bite to sell only, right? That's the difference between

using Did you buy something? Did you acquire it to sell, that's

your primary focus that said, I want to sell it, you know, I'm

getting this as a good rate, I'm gonna sell it. That's the reason.

If that is the case, you bought it to sell right from the beginning,

you bought it or you acquired it in the sense that you either

purchased it by giving money, or you got it like you got a

business. And somebody Oh, there's one of your one of your customers

owed you money, right? wholesale customer owes you money, and then

he couldn't pay you. So he says, Look, I sell ice cream, can I just

give you ice cream? So you're saying, Well, I'm not going to get

my money from him anyway, right? He's not going to pay me I might

as well take the ice cream from him, I may take these phones from

him, I may take these batteries from him, or whatever. I've got

this old guy saying, Can I afford this car? Company card? Can I just

give that to you to pay off my loan? So when you're getting that

your intention is I'm not going to keep this? I have no use for it.

I'm going to sell it. So again, you're acquiring with the

intention of resale, expressing resale. So that also becomes a

good likewise, if somebody is renting your house, right? And

they can't pay you? Are they renting your store and they can't

pay you? So they say, look, I've got all of this stock sitting

here, right? Why don't you just take that for the payment instead.

So when you take that payment, your intention, I'm not going to

use this for myself, I'm going to sell it, I'm going to turn it

around. So again, you've acquired whatever you've acquired for

resale. And generally, you do that in three ways. You either purchase

it, or you get it in lieu of a business debt, or you get it in

lieu of a rental debt. That's how you will otherwise anything else

that I've acquired before, right, I've got a really nice jacket, I

don't want to use it anymore. It's still brand new as an unwanted

gift, and I want to sell it, you will not pay the car. That's not

the car trouble until you sell it. And then that just goes into your

normal income that if on the day of your zakat calculation, you're

your anniversary, you have that money, right that's with

everything. So now, let's just say somebody's inherited a piece of

land duped and they don't want to use it, they want to sell it.

Now that wasn't inherited through business he just came through.

That's why there's going to be no zakat on there. It doesn't matter

it's a very valuable land, you inherited a building no zakat on

there. The only the so it's not as the cattle but asset. Now the day

you sell it, and you get the money and you retain whatever amount of

that money on your second date, then you will pay zakat on that

but otherwise you don't pay it on the value of that likewise. So

whether that's real estate or you got a lot of cars, right.

One thing I want to clarify is that if you're doing a car

business, we actually buying cars to sell. You may use them but your

main until you sell it you're just going to drive around with it. So

every new car you get to sell you also drive

Around, your main reason is that you're setting it, you know, you

find a customer today you're going to sell it, that means all of

those cars will be Zeca trouble at the value at their value, because

they are a business as their inventory, right. But if you got,

as I mentioned before in another session, that if you've got cars

which are renting out, then there's no regard on the value of

them, because you're not selling those cars, you're selling their

service, right? Likewise, any other object you've got. And so

let's just say that you've got a house which is on sale for one

year or two years, you don't want to live it in it, but you did not

buy to resell, you bought it for rental, then you decide you know

what, I need to set it up, I need the money. So then you started

selling it. Even though it's on the market for two, three years,

you're not using it, you're not renting and you're just waiting

for it to be sold. There is no zakat on the value of that until

you sell it. But if I had purchased that I got a good deal.

So I purchased it to resell because I buy and sell houses, or

I don't buy and sell houses but I bought this one, right the friend

was going to sell he had to leave he needed the money quickly. So I

purchased it, and then I'm going to sell it that's my objective of

doing so then I will pay zakat on that. So remember, if it's you

only pay zakat on the value of something if you purchased it for

resale directly even if then you use it a bit just but your main

objective is to sell it yes if you purchased it, to use it and maybe

to sell it if you get a good price in the future sometime then

there's no zakat on the until you actually pay and then only on the

retain income likewise now let's just say that you purchased the

house to sell and then it wasn't selling so you decide I'm going to

rent it out now that and then you're not going to sell it

anymore. No longer do you have to pay once you've changed that

intention you put it into another use no longer do you have to pay

zakat on the value of the house anymore. So hopefully I think I've

covered everything regarding that and hopefully that makes it easy

because this can be very confusing. Right and can a lot of

people can make mistakes about this. So hopefully we pay as I got

correct like that. Just like a lot here. A cinematic