Is Zakat Applicable on Rental Income From a House?

Yes, zakat is applicable on rental income if it meets specific conditions. 

The property itself is not subject to zakat, but the income generated from renting it is. Here’s how it works:

Conditions for Zakat on Rental Income:

• Reaching Nisab: Zakat is due if the rental income alone, or combined with other savings, meets the minimum threshold.
• Passage of One Hijri Year: The rental earnings must remain in possession for a full Islamic year before zakat is due.
• Rate of Zakat: 2.5% of the total rental income that meets the nisab must be given as zakat.

Example:

• If someone earns PKR 1,500,000 in rental income and it remains saved for a full lunar year, zakat is calculated as:
  1,500,000 x 2.5% = PKR 37,500
• However, if the rent is received at the beginning of the year and spent before the year is completed, no zakat is due on that amount.

Remember:

✔ The zakat year starts from the date of receiving rent.
✔ If the rental income is spent before a year passes, it is exempt from zakat.
✔ Careful tracking of rental earnings helps determine zakat obligations.

By following these guidelines, property owners can ensure they fulfill their zakat duties correctly.

And Allah knows best!

Other Zakat Questions You May Have

• Can Benefits from a Zakatable Asset Change Zakat Payments?
• Is Zakat Applicable to All Assets in a Pension Fund?
• What Assets Are Subject to Zakat in Islam?
• Is Zakat Due on Properties and Other Fixed Assets?
• Is a Lunar Year Necessary for Zakat on All Zakatable Assets?
• Is Zakat Applicable to Industrial Tools and Equipment?