What is purification of investment income?

Why purification exists

A company can pass a Shariah screen even though a small amount of its income comes from incidental non-compliant sources, provided this remains within the limits of the relevant methodology.

Purification is intended to remove the investor's share of that impermissible income.

How it generally works

A screening provider, fund manager or Shariah adviser may calculate a purification amount using information about the company's non-compliant income. The investor or fund then gives the relevant amount to charity rather than treating it as personal investment income.

The exact calculation is methodology-specific. It should not be assumed that every fund uses the same purification ratio.

Funds can handle it differently

Some Shariah-compliant funds perform purification within the fund before distributions reach investors. Others may publish purification information so that investors can make the adjustment themselves.

The fund's documents should explain its approach.

Purification is not the same as zakat

Purification and zakat are separate concepts. Purification concerns income identified as non-compliant under a Shariah investment methodology. Zakat is a separate religious obligation with its own conditions and calculation rules.

Purification also does not make a fundamentally prohibited business permissible. It is generally relevant to small incidental amounts within an otherwise acceptable investment.

This guide is general education and does not provide a personal religious ruling.