Is zakat obligatory on a sum of money that has been invested in the construction of a residential building, and is zakat obligatory on this building when it is sold?
If the amount is still in your possession, allocated for building a residence, and the conditions for are met (reaching the and the passing of a full year), then you must pay zakat on it annually at a rate of 2.5% until it is used for the building.
However, if the money has been used for a building for residence and personal use (and not for trade), then there is no zakat on it, due to the Prophet’s (peace be upon him) saying: "There is no (zakat) on a man's slave or his horse."
But if it is used for a building for sale and trade, then it is considered a trade asset, and zakat becomes obligatory on it if your share of the building's value reaches the nisab and a full year has passed over it.
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