For Singapore's 850,000+ Muslim community, there are religious obligations that no conventional financial plan addresses. Zakat. Shariah-compliant investments. Takaful. Faraid. This is where they all converge into a unified wealth strategy.
Malays comprise 15.1% of Singapore's resident population. As a financially active community, they carry specific religious and financial obligations that conventional advisory frameworks simply do not recognize or address.
Conventional financial planning overlooks all four. Islamic wealth advisory integrates all four into a single, cohesive plan aligned with Quranic principles and your family's values.
The obligatory 2.5% redistribution of surplus wealth, and the critical investment obligation many Muslims unknowingly overlook.
Building a Halal portfolio that excludes riba (interest), gharar (excessive uncertainty), and maysir (gambling), including Shariah-screened CPFIS options.
Protection without compromise: understanding Takaful as an ethical alternative to conventional insurance in Singapore's evolving market.
Faraid, Wasiat, Hibah, and Waqaf: the Islamic estate framework that supersedes any conventional Will you have executed.
Zakat is not a religious tax. It is a fundamental act of worship: the deliberate redistribution of wealth to those in need, which simultaneously purifies the wealth of the giver.
"Zakat is not merely a financial transaction. It is a sacred religious obligation for all able and privileged Muslims to redistribute their blessings and share prosperity with the less fortunate in the community."
MUIS Zakat.sg, Official Singapore Zakat Authority
Nisab is the minimum amount of wealth you must hold before Zakat becomes obligatory. It is pegged to the market price of 86 grams of gold, and updated monthly. As of the current MUIS-aligned reference rate, Nisab stands at approximately SGD 17,017, a threshold most working Singaporeans quietly exceed.
Zakat is only payable if you have completed the Haul, which is one full Hijri year (355 days) of continuous ownership above Nisab. Zakat is calculated on the lowest amount held throughout that period, not on the peak balance.
Once you exceed Nisab and complete Haul, 2.5% of your eligible surplus wealth is payable as Zakat. This ensures equitable distribution of wealth among the Muslim community.
All investment tools, including stocks, shares, ETFs, unit trusts, and REITs, are subject to Zakat. Unlike savings Zakat, investment Zakat is triggered once the market value exceeds the Nisab threshold. The majority of Singaporean Muslims with investment portfolios have never performed this calculation.
Monies in CPF accounts that cannot be withdrawn are exempt from Zakat per MUIS Fatwa Committee ruling. However, CPF Investment Scheme (CPFIS) holdings and accessible CPF savings above age 55 are subject to Zakat. This critical distinction can affect your annual obligation significantly.
Financial Alliance's Islamic Wealth Advisory (FAiWA) division officially partners with MUIS and PERGAS on Zakat calculation services for clients, providing authoritative, fatwa-aligned Zakat guidance tailored to your specific portfolio.
Green = Zakat payable · Red = Typically exempt · Based on MUIS fatwa guidelines
Zakat distribution is not arbitrary. The Quran (Surah At-Tawbah, 9:60) prescribes eight specific categories of recipients. Modern platforms like Purifai.sg allow donors to allocate their Zakat across these eight Asnaf via direct PayNow transfers to MUIS-approved Muslim organisations.
Those with almost no possessions or means of livelihood.
Those with insufficient income to meet basic daily needs.
Zakat administrators and collectors (capped at 1/8 of collected funds).
New converts and those strengthening their faith and community ties.
Those experiencing severe socio-economic constraints or bondage.
Individuals burdened by legitimate debt they cannot repay.
Causes for community advancement and the path of Allah.
Travellers in temporary financial difficulty, cut off from their resources.
📖 "Zakat expenditures are only for the poor and for the needy and for those employed for it and for bringing hearts together [for Islam] and for freeing captives [or slaves] and for those in debt and for the cause of Allah and for the [stranded] traveller—an obligation [imposed] by Allah." Surah At-Tawbah, 9:60
A Shariah-compliant portfolio is not a restrictive version of conventional investing. Rather, it is a purposeful framework that deliberately aligns your wealth growth with your core values and religious obligations.
Any guaranteed, predetermined return on money, including fixed deposit interest, bond coupons, and many conventional ILP returns. Most Singaporeans have unknowingly accumulated riba proceeds over years.
Ambiguity or uncertainty in contract terms. Conventional options, derivatives, and certain structured products with unclear payoff conditions fall under this prohibition.
Gains based purely on chance rather than legitimate business activity. Highly speculative instruments and certain leveraged products are typically excluded from Shariah-compliant portfolios.
As at July 2025, 99 CPF Investment Scheme unit trusts are available, of which 89 accept direct subscriptions. A Shariah-screened subset allows Muslims to grow their CPF OA savings in Halal funds, yet most members remain unaware that this option exists.
If you have earned interest on fixed deposits or received non-compliant returns, these amounts must be purified through charity rather than kept. FAiWA provides specific advice on the treatment of non-compliant proceeds from ILPs, fixed deposits, and legacy policies.
Financial Alliance is the only financial advisory firm in Singapore with a dedicated Shariah committee. Their solutions are 100% Shariah-based: products are either inherently Shariah-compliant or deemed permissible by in-house and external Shariah advisors. No other IFA in Singapore offers this institutional structure.
Takaful is not a niche product. It is the Islamic model of financial protection, built on mutual solidarity rather than corporate profit, and designed to eliminate riba, gharar, and maysir from your coverage entirely.
Currently, there are no "fully" Takaful operators in Singapore. This places many Muslims in a practical grey zone, where they hold conventional policies because pure Takaful options remain limited locally.
A landmark development arrived in March 2026, when Etiqa Insurance Singapore and AIA Singapore announced a strategic distribution partnership to broaden access to Shariah-compliant, values-based Takaful solutions. This represents a significant signal that the market is evolving rapidly.
FAiWA's role is to help you navigate this landscape: understand which policies are acceptable, which require purification of proceeds, and what Shariah-aligned alternatives are available now and as the market develops.
Historical data from 2020 to 2024. Projections extend to 2034 based on industry research and market trends.
Every Muslim in Singapore is subject to Faraid, the Islamic inheritance law, whether they acknowledge it or not. Most estate plans prepared without this foundational knowledge are structurally incomplete from inception.
Faraid is the Quranic inheritance system that assigns fixed proportional shares to family members including spouses, children, and parents. It is administered by the Syariah Court under the Administration of Muslim Law Act (AMLA).
It is not optional. Every Muslim's estate in Singapore is governed by Faraid for assets not otherwise directed, regardless of any conventional Will you may have written. A conventional Will prepared without Islamic estate knowledge is an incomplete document for any Muslim.
A Wasiat is not the same as a conventional Will. Under Muslim law, a Wasiat can direct only up to one-third of the estate, and only to non-Faraid heirs (people not entitled to inherit under Faraid).
The remaining two-thirds is distributed by Faraid's fixed formula. This distinction is almost universally misunderstood. Many Muslims believe their Will governs their entire estate, when in fact only a fraction of it is directible by Wasiat.
Under a MUIS fatwa, CPF nominations are considered a form of Hibah (gift). This means CPF monies bypass Faraid entirely and go directly to named nominees. If a deceased Muslim has made a CPF nomination, those nominees receive the amount in full, and it is not redistributed according to Faraid.
The danger: naming only one child, or naming nominees in incorrect proportions, permanently diverts wealth away from its rightful Islamic heirs. A wrong nomination cannot be undone after death. MUIS highly recommends nominating Faraid heirs using the Syariah Court's Faraid Calculator.
Hibah Ruqba is a gift of absolute property ownership with one condition: if the recipient survives you, the property belongs to them absolutely. Both parties hold shared ownership until one predeceases the other, after which ownership transfers accordingly.
The 2019 MUIS Fatwa Committee ruling confirmed that joint tenancy or tenancy-in-common arrangements already address most property planning needs, making Hibah Ruqba or Nuzriah grants no longer required in most cases. However, the correct structure must be deliberately selected and documented, requiring specialist guidance to execute under both Muslim law and Singapore civil law.
Singapore's Waqf (Waqaf) assets are valued at over SGD 800 million, with 91 properties managed by MUIS. Waqaf is a perpetual Islamic endowment, meaning wealth set aside permanently for the benefit of the Muslim community and approved charitable causes.
Cash Waqaf, which involves contributing money (not just property) into a perpetual endowment, means any Muslim can participate in this enduring legacy at any wealth level. FAiWA explicitly includes the creation of Cash Waqaf as part of the Islamic estate consultation process, connecting your personal wealth plan to the community's larger endowment infrastructure.
Estate: SGD 1,000,000 · Heirs: spouse, 2 sons, 1 daughter · Distributed per Quran-prescribed shares
The FAiWA Financial Consultation Checklist (FCC) identifies these critical gaps in most Muslim clients' existing financial plans.
| Area | Common Gap | FAiWA Can Help |
|---|---|---|
| Zakat on Savings | Never calculated; unsure if Nisab is met or Haul completed | ✓ Zakat calculation via MUIS |
| Zakat on Investments | Unit trusts, ETFs, and shares where Zakat was never calculated on portfolio value | ✓ Portfolio Zakat audit |
| Non-Compliant Proceeds | Fixed deposit interest and ILP returns held in savings, which require purification | ✓ Purification advisory |
| CPFIS Shariah Funds | CPF OA invested in non-compliant funds; unaware Shariah-screened options exist | ✓ Shariah fund migration |
| CPF Nominations | Named single child or incorrect Faraid proportions, which will bypass Faraid permanently | ✓ Faraid-aligned nomination |
| Wasiat / Will | No Wasiat, or a conventional Will that doesn't account for the 1/3 limit and Faraid | ✓ Islamic Will structuring |
| Property Ownership | Property held under joint tenancy without understanding its Faraid implications | ✓ Tenancy structure review |
| Takaful Coverage | Conventional insurance held with no Shariah review; unclear if coverage is acceptable | ✓ Takaful/insurance review |
| Cash Waqaf | Never considered as part of estate plan; unaware of how to participate | ✓ Waqaf creation guidance |
Financial Alliance's Islamic Wealth Advisory (FAiWA) division holds institutional credentials that no other independent financial advisory firm in Singapore can match.
Financial Alliance is the only independent financial advisory firm in Singapore with a dedicated Shariah committee. Every recommended solution is either inherently Shariah-compliant or vetted by in-house and external Shariah advisors.
FAiWA officially works with the Islamic Religious Council of Singapore (MUIS) on Zakat calculation for clients, as well as with PERGAS and other Muslim organisations on a comprehensive Zakat calculation scheme. This is institutional-level authority that no individual IFA can replicate.
Financial Alliance is the only IFA firm to attain both the Singapore Quality Class (SQC) and People Developer statuses, reflecting the highest standards of organisational excellence and human capital development in the advisory sector.
FA conducts in-house Islamic Wealth Management Certification training to equip consultants to serve Muslim clients at a professional standard that goes beyond general financial planning knowledge.
FA has introduced a proprietary list of unit trusts in compliance with established Shariah principles, including a curated subset of CPFIS-eligible Shariah-screened funds. This list is continuously reviewed by the Shariah committee.
FA provides clients access to some of the most established names in Islamic inheritance and Zakat in Singapore, connecting financial planning with legal, religious, and estate execution expertise in a single advisory relationship.
Enter your eligible assets to determine if Zakat is payable this year. Based on MUIS-aligned guidance, Nisab is set at SGD 17,017 (the current value of 86 grams of gold, updated monthly). For the full 16-asset-category calculator with PayNow integration to Asnaf beneficiaries, refer to Purifai.sg.
Enter your assets to see
your Zakat calculation
Clarity on Zakat, Shariah investing, Takaful, and Faraid: your pathway to Islamically-aligned wealth.
Zakat is payable on liquid and investment assets: savings held in bank accounts, investments such as stocks, bonds, and mutual funds, CPFIS investments, precious metals like gold and silver, business inventory, and insurance cash surrender values. It is not payable on your primary residence, personal vehicles, household goods, or the mandatory CPF Ordinary Account (OA). The total eligible wealth must exceed the Nisab (SGD 17,017 pegged to 86 grams of gold) and be held for one full Hijri year before Zakat becomes obligatory.
The Ordinary Account (OA) is exempt from Zakat as it is earmarked for living expenses in retirement. However, the Special Account (SA), Medisave Account (MA) if you are not drawing on it, and any CPFIS investments are subject to Zakat. Different schools of Islamic jurisprudence (madhabs) have varying views on whether CPF contributions should be counted, as they are partially compulsory and partially for future use. FAiWA works with MUIS to ensure compliance with Singapore's adopted Zakat methodology.
Faraid is Islamic inheritance law, dictated by the Quran and Hadith, which automatically applies to two-thirds of your estate regardless of whether you have a Will. Shares are fixed by Islamic law: spouses receive either one-quarter or one-eighth, children receive specific percentages, and parents and siblings have defined rights. A Wasiat (Islamic Will) can only direct up to one-third of your net estate to causes or people not prescribed in Faraid. While a conventional Will overrides intestacy law entirely in secular contexts, in Singapore, Faraid is administered under the Administration of Muslim Law Act (AMLA) and takes precedence over secular Wills for Muslim decedents. You must plan for Faraid.
Takaful is mutual assistance insurance compliant with Shariah principles, structured without riba (interest), gharar (uncertainty), or maysir (gambling). Participants contribute to a common pool, and payouts are drawn from that pool rather than from an insurance company's profit. Conventional insurance operates as a commercial contract where the insurer profits from your premiums, whereas Takaful is a cooperative agreement among participants. However, Takaful offerings in Singapore remain limited, as several major providers have withdrawn from this market segment. Some Muslims accept conventional insurance with specific Shariah-compliant riders or seek guidance from their Shariah scholar.
You must invest in Shariah-compliant assets to avoid riba, gharar, and haram industries (alcohol, pork, gambling, weapons, conventional banking with interest). Shariah-screened funds (CPFIS Shariah funds, FAiWA-recommended portfolios) exclude companies involved in haram activities and those with excessive debt-to-equity ratios (riba indicators). Buying conventional stocks or bonds with riba components is not permissible under Islamic law, even if your personal intent is ethical. FAiWA screens every investment recommendation through a Shariah lens.
Hibah is a gift in Islamic law, an irrevocable transfer of ownership during your lifetime. A CPF nomination is a Hibah-aligned mechanism: when you nominate a beneficiary for your CPF, you are gifting that portion of your CPF to them. The nomination survives inheritance law and goes directly to the nominee. This is legally efficient because your CPF bypasses probate and reaches your chosen beneficiary immediately. However, a CPF nomination does not count as a one-third Wasiat (Islamic Will allocation); it is treated as a separate transfer. Coordinate your CPF nominations, Wasiat, and Faraid planning so they work together as a unified strategy.
No. Under Islamic law, a Wasiat can only dispose of up to one-third of your net estate after debts and funeral costs are settled. The remaining two-thirds is automatically distributed under Faraid to your heirs (spouse, children, parents, siblings) according to fixed Islamic shares. This is a protection mechanism: Islamic law ensures that heirs have security while still allowing you testamentary discretion for up to one-third. Any Wasiat exceeding one-third is void beyond that threshold, unless your heirs voluntarily consent to the excess after your death.
Waqaf is a perpetual charitable endowment. You set aside assets (property, investments, or cash) as a permanent trust whose income benefits specified beneficiaries or causes. Unlike a conventional trust that eventually distributes capital, a Waqaf's principal is locked in perpetuity. Waqaf benefits can support family members while simultaneously serving religious or charitable purposes. Setting up a family Waqaf requires a proper legal structure (often via a foundation) and Shariah advisor approval. In Singapore, MUIS and estate planning lawyers can help structure a Waqaf that fulfils both Islamic and legal requirements.
Schedule a consultation with Hock Beng, a CFP® backed by FAiWA's institutional credentials, the MUIS Zakat partnership, and Singapore's only IFA Shariah committee. Together, we will build a plan that fulfils your religious obligations and protects your family's legacy.