Ushr on a Pakistani Farm: How to Calculate It, Record It and Know What You Still Owe

Ask a farm manager how much ushr the farm paid last year and you will usually get two answers. The owner remembers a figure in maunds. The munshi has a different figure in a register. Neither of them can tell you what it cost the farm in rupees, and neither can say whether this season’s ushr on the wheat in the store has been given out yet or is still owed.

That is not because anyone is careless. It is because ushr is paid in grain, at a time of year when everyone is busy, and almost no accounting software in Pakistan knows the word. So it ends up on a calculator and a page in a diary, outside the books. This piece is about bringing it inside: how to work it out, how to record it, and how to always know what you still owe.

The calculation itself is the easy part

The rate most farms work with is well known: ten percent of the produce from land watered by rain or natural flow, and five percent from land watered by tubewell, canal or other irrigation you pay for. Most of Punjab’s wheat is irrigated, so five percent is the figure most wheat farms use. Ushr is taken on the produce harvested, before costs are deducted.

Take a worked example we will use for the rest of the piece. Block C is 40 acres of irrigated wheat. It yields 40 maunds an acre, so the harvest is 1,600 maunds. At five percent, the ushr is 80 maunds. Anyone with a calculator gets that far.

Where it goes wrong is everything after the calculator. What is 80 maunds worth in the books? When is it recorded? What happens when it is given out in grain from one store and in cash for the rest? And what happens to the register when the harvest figure is corrected a week later?

Value it at what the grain cost you, not at the mandi rate

Suppose the season’s seed, fertiliser, diesel, water and labour on Block C come to four million rupees. Spread over 1,600 maunds, the harvest cost is PKR 2,500 a maund. On the day of the harvest the mandi is paying, say, PKR 3,900.

Many farms value the ushr at the mandi rate, because that is the number everyone talks about. But the 80 maunds that leave your store are not sold. They are stock leaving at the cost you carry it at, exactly like grain issued for seed or for the workers’ ration. Value them at the mandi rate and your books show an ushr expense of PKR 312,000 against grain that only cost PKR 200,000 to grow, and the stock and the ledger stop agreeing.

So the right moment to record ushr is the day the harvest is signed off, and the right value is the harvest’s own cost. The farm owes 80 maunds from that moment, whether it gives them out tomorrow or after Eid.

Ushr Payable is now a real liability with its own ledger. It answers the question nobody could answer before: how much ushr is still owed, crop by crop and harvest by harvest.

Paying it in grain

When the grain is given out, it leaves a store. That has to move stock, or the stock register will show 80 maunds that are no longer there and the next sale will be short.

Payable is back to zero, the store is 80 maunds lighter, and the expense stays exactly where it was recorded on harvest day. If the stock cost in that store is slightly different from the harvest cost by the time you pay, the difference goes to Ushr Expense, and the ledger still closes to zero.

Paying it in cash

Some farms prefer to sell the whole crop and give ushr in cash. Then the farm pays the value of the grain at the rate it chooses, and the amount rarely matches the cost recorded on harvest day.

The correction that breaks the register

Here is the one that catches every paper system. The harvest was entered as 1,600 maunds, but a trolley was counted twice and the real figure is 1,520. The harvest is corrected, and the ushr on it should now be 76 maunds, not 80. On paper the register still says 80, and nobody goes back to it.

In NavoBook the ushr entry belongs to the harvest that created it. Delete the wrong harvest and its ushr reverses with it; enter the right one and the ushr is worked out again from 1,520 maunds. And a harvest whose ushr has already been paid, in grain or in cash, cannot be deleted at all until that payment is dealt with first, so a settled liability can never be left pointing at a harvest that no longer exists.

Not every crop, and not every product

Ushr is due on the produce, not on everything the farm handles. Wheat seed bought for sowing carries none. Neither does fodder bought for the animals. So the rate in NavoBook is set on the crop item itself: you set five percent on wheat, ten percent on a rain-fed crop if you grow one, and nothing on items that carry no ushr. A harvest of a crop with no rate accrues nothing. The rate is yours to set, and you can change it for next season without touching the harvests already recorded.

What this gives the owner

• Ushr owed right now, across every crop and harvest, in maunds and in rupees.
• Ushr paid this season, split between grain and cash, each payment against the harvest it settled.
• A true crop margin. Ushr is a real cost of the crop, and it now sits inside the crop’s numbers instead of outside them.
• A stock register that agrees with the store, because the grain that was given out actually left the books.

It also tidies the year-end. On a partnership farm, the profit split between the partners is only as good as the profit figure underneath it, and an ushr expense left outside the books is a figure one partner will question. With ushr on the ledger, the year-end split runs from numbers everyone can trace back to a harvest.

How it fits with the rest of the farm

Ushr is one step in a longer chain. Inputs are charged to a crop cycle as they are used, the harvest becomes a costed lot, and that cost is what the ushr and the eventual sale both read. If the input side is still on paper, start there: our piece on crop costing on a 1,000-acre farm walks through how cost gathers on a cycle, and the one on FIFO and weighted average explains why the store’s cost can drift from the harvest’s.

The agriculture page shows the whole module, including partners’ capital and current accounts. Ushr itself is switched on per company, so a farm that does not want it never sees the screens. The farms that do want it finally get an answer to the question at the top of this page, in rupees, on the day they ask.