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Hadith: Legal or Illegal Earning

Bismillah Walhamdulillah Was Salaatu Was Salaam 'ala Rasulillah As-Salaam Alaikum Wa-Rahmatullahi Wa-Barakatuhu Trade - 8th Shawwal 14...

Bismillah Walhamdulillah Was Salaatu Was Salaam 'ala Rasulillah

As-Salaam Alaikum Wa-Rahmatullahi Wa-Barakatuhu

Trade - 8th Shawwal 1433 (26th August 2012)

Narrated Abu Huraira (Radi-Allahu 'anhu):

The Prophet (Sallallahu 'Alaihi Wa Sallam) said, "A time will come when one
will not care how one gains one's money, legally or illegally."

Bukhari Vol. 3 : No. 275
Comment: we should audit ourselves whether we are earning in halal ways or haram ways, for example



Industry sectors that generally don't manufacture or market forbidden products are considered halal, and are acceptable for Muslim investors. Some classic examples of suitable industries are:

  • Chemical manufacture
  • Computers and computer software
  • Energy
  • Telecommunications
  • Textiles
  • Transportation

When considering a halal investment, you need to look deeply into a company's business to discover its core source of revenue, or how it actually makes its money. Its industry sector, or part of the economy to which it belongs, may not always tell you the whole story.


To simplify the task of identifying investments that meet specific criteria, financial institutions and analysts put companies through a series of screens, or questions. Islamic screens assess whether the business activities of the company are halal or haram:

  • Does the company engage in haram business activities?
  • Is the company's leverage, or debt ratio, too high?
  • Is too large a percentage of the company's assets liquid, or in cash?

If the answer to any of the questions is yes, the company may fail the screening process. That makes its stock an unacceptable investment.

For example, a computer software company may produce products used in gambling. A publishing company might print some works that are considered pornographic. Or an agricultural producer might sell its crops exclusively to breweries.


Islamic law identifies business activities as haram when they generate profits in unacceptable ways. Haram business activities include the manufacture or marketing of any of these products:

  • Haram
  • Alcohol
  • Gambling or gaming activities
  • Conventional financial services
  • Pork and pork products
  • Pornography

In addition, most Shariah scholars advise against investing in tobacco companies or those involved in weapons and other defense-industry products. And many classify the entertainment industry in general as haram.


Islamic legal scholars use several conventions to determine when a business activity is a core source of revenue and when it is not. The 5% rule says that a core business is one that accounts for more than 5% of a company's revenue, or gross income. For example, if the sale of alcohol accounts for less than 5% of an airline company's revenue, alcohol is not a core business and investing in that company's stock is generally acceptable.

A somewhat less stringent rule sets the standard for a core business at 10%, and different Islamic scholars may set different limits.

This reasoning applies to the Islamic prohibition on riba, or interest, as well. If a company's interest-based profits or holdings exceed certain limits, then investing in the company is forbidden. Even when these are found to be within tolerable limits, purification of earnings from these companies must take place


I would like to ask about Muslims who make their income from a Haram source (for example, selling alcohol in their business). A Hadith says what is in the meaning that when such a person asks Allah for His help, Allah does not respond to him because his source of income is Haram.
My questions are:
(1) These Muslims acknowledge that they are doing something Haram but that they are weak in front of their desires. Does the fact that their source of income is Haram make them a Kaffer (non-believer) or do they remain as Muslims?
(2) The Hadeith mentions that Allah does not answer them when they ask him for help. And of course their Zakah and Hajj are not acceptable because their money is from a Haram source. Is their Salah, Fasting and reading the Qur'an acceptable to Allah or are all their good actions not acceptable according to Islam?


Praise be to Allah, the Lord of the Worlds; and blessings and peace be upon our Prophet Muhammad and upon all his Family and Companions.
People who claim to be Muslims can not be suspected of disbelief for any sin they commit unless they say that what is forbidden in Sharia is lawful or they worship anything other than Allah.
So, those who deal in Riba and alcohol to please themselves in This Life, are treated as Muslims. If any of them dies without repenting, Allah will do with him as He pleases. He might forgive him from His Mercy and Compassion or He might punish him proportionally for his sins. If Allah punishes this person in the Hell Fire, he will not stay there forever because he died believing in Allah and His Prophet. As narrated in the sound Hadith the Prophet said: "Allah will say, go and take out of it (Hell) all those who have faith in their hearts equal to the weight of a small and or a mustard seed".
As for your second question: no doubt Allah only accepts the pure, so He does not accept impure money or its Zakah. The Du'a (supplication) of the person who eats the impure and the forbidden is not accepted by Allah as narrated in the Hadith mentioned in your question. As for performing Hajj from such money there is no consensus among the scholars over this issue. Most of them believe that such a Hajj suffices although he has committed a sin. But Imam Ahmad believes that this Hajj does not suffice him because the Hadith that the Prophet said: "O people, Allah is Good and He, therefore, accepts only that which is good". [Sahih Muslim].
As for prayer, reading the Qur'an, fasting and all other physical forms of worship, they are correct and he is not asked to perform them again.
Allah knows best.

M Junaid Tahir
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