Halal Investing UK: ISAs, ETFs, Pensions and Apps (2026)

Halal investing in the UK means owning shares or funds that pass Sharia screening, inside the same tax wrappers everyone else uses: a stocks and shares ISA, a pension or a general investment account. The simplest routes are a managed halal platform such as Wahed, or a low-cost Islamic index ETF (for example iShares MSCI World Islamic, ticker ISWD) held in an ISA. Whichever you choose, switch off interest on uninvested cash and avoid leverage and CFDs.

Is investing halal at all?

Yes, with conditions. A share is part-ownership of a real business, and profit from a real business, with real risk, is what Islamic finance encourages. The problems come from three places:

1. What the company does. Alcohol, pork, conventional banks and insurers, gambling, adult entertainment, tobacco and (on most screens) weapons are out.
2. How it is financed. A company that borrows heavily at interest or holds a lot of interest-bearing cash is a problem even if its business is fine.
3. How you trade. Margin, short-selling, options, CFDs and spread bets are generally considered impermissible because of riba, gharar or maysir. Investing for the long term is fine. Gambling-style day trading is not.

Screening criteria: the AAOIFI ratios

AAOIFI’s Sharia Standard on financial papers (shares and bonds) is the benchmark many UK providers and apps follow. In simplified form:

Index providers use similar but not identical rules. MSCI, for example, uses one-third of total assets rather than market value. That is why a share can be “halal” on one app and “doubtful” on another. Neither is necessarily wrong. They are using different methods.

Purification. If 2% of a company’s income is from interest or another haram source, about 2% of the dividends you receive from it should be given to charity. Most screening apps estimate this for you.

Option 1: a managed halal platform (Wahed)

Wahed is an FCA-authorised halal investment platform with a dedicated Sharia review board. You answer a few questions, it puts you in a Sharia-screened portfolio (global Islamic equities, sukuk and sometimes gold), and it rebalances for you.

• Accounts: stocks and shares ISA, general investing, personal pension (SIPP), and a workplace pension through Smart Pension (launched 2024).
• Fees: an annual wrap fee that covers management, custody and dealing, plus the underlying fund costs. A £2.50 monthly maintenance fee applies to the SIPP. Check Wahed’s pricing calculator for the current percentage at your balance (checked November 2026).
• Best for: people who want to set it up once and not think about screening.
• Downsides: typically dearer than buying an Islamic ETF yourself, and you have less control over what you hold.

Our pick for beginners: Wahed if you want a fully halal ISA or pension with screening and purification handled for you. If you are comfortable picking one fund yourself, an Islamic ETF on a low-cost platform will usually be cheaper.

Option 2: Islamic index ETFs and funds

An Islamic ETF holds every company in a Sharia-screened index, with a Sharia board overseeing it. One fund can give you hundreds of global companies.

Figures checked November 2026. BlackRock has said one listing line of the iShares fund will be delisted on 15 December 2026, so check which line your platform offers before buying.

Points to know:

• Concentration. Islamic indices exclude banks and most highly indebted companies, so they lean heavily towards technology and healthcare. In recent years that has helped returns, but it means less diversification than a normal world tracker.
• Distributing vs accumulating. ISWD pays out dividends twice a year, which makes it easier to see what to purify.
• The HSBC Islamic Global Equity Index Fund is a traditional fund rather than an ETF. Platforms such as Hargreaves Lansdown, AJ Bell and Fidelity offer it, and many pension schemes use it as their Sharia option.

Option 3: Trading 212 (and similar apps) the halal way

Trading 212 does not offer an “Islamic account”, but many UK Muslims use it because it has no dealing commission and lets you buy ETFs like ISWD and HIWS inside a stocks and shares ISA. To keep it as clean as possible:

1. Use the Invest account or Stocks ISA only. Do not open the CFD account.
2. Leave “interest on uninvested cash” switched off. It is opt-in. Some terms have said the firm may still earn interest on uninvested money even if you do not opt in, which some scholars see as a remaining concern. Keeping your cash invested rather than sitting idle reduces the problem.
3. Leave share lending switched off.
4. Avoid the Cash ISA, which pays interest.
5. Screen individual shares with an app before you buy (see below), and avoid “pies” built by other users unless you check every holding.

The same approach works on other platforms. Pick a low-cost provider, buy an Islamic fund and switch off cash interest.

Picking individual shares: Musaffa and Zoya

If you want to buy individual companies, use a screening app rather than guessing:

• Musaffa screens UK, US and many other markets using AAOIFI methodology, gives a halal/doubtful/not-halal verdict and estimates purification.
• Zoya is AAOIFI-based with scholar oversight. Its strongest coverage is US stocks, with more limited UK coverage.

Both have free tiers and paid plans. Re-check your holdings at least once a year, because a company can fail screening after an acquisition or a big new loan.

Halal stocks and shares ISA

You can put up to £20,000 a year into ISAs. From 6 April 2027, under-65s can only put £12,000 of that into a Cash ISA, so the rest goes into stocks and shares or other ISA types (checked November 2026). For Muslims who were already avoiding interest-paying Cash ISAs, that change makes little difference.

Ways to hold a halal ISA:

• Wahed ISA: fully managed and screened.
• A platform ISA holding an Islamic ETF or fund: Trading 212, InvestEngine, AJ Bell, Hargreaves Lansdown and others. Cheaper, but you do the screening.
• An Innovative Finance ISA with a Sharia-compliant property or private-credit provider such as Cur8. Higher risk and less liquid. Read the risk warnings carefully.

A Lifetime ISA can be halal too: the 25% government bonus is generally treated as permissible. Avoid cash LISAs and check that a stocks and shares LISA offers a Sharia fund.

Halal pensions

This is where most UK Muslims have the most money, often without realising it is invested in interest-paying bonds and banks.

If you have a workplace pension:

1. Log in to your provider (Nest, Aviva, Legal & General, Scottish Widows, Royal London, and so on).
2. Look for a fund called Sharia, Shariah, Islamic or “HSBC Islamic”. Nest has a Sharia fund. Many other schemes use the HSBC Islamic Global Equity Index Fund.
3. Switch your existing pot and future contributions into it. This is usually free.
4. Do not opt out. You would lose your employer contribution and tax relief, neither of which is interest.

If you want a personal pension (SIPP):

A risk to plan for. Sharia pension funds are usually all or mostly equities, with sukuk in some cases. That is fine when retirement is decades away, but they can fall sharply in a crash. In the ten years before you retire, consider moving some money into sukuk funds or an Islamic bank’s fixed-term deposits to reduce the swings.

A simple halal investing plan

1. Clear expensive debt and keep three to six months’ costs in a halal savings account.
2. Switch your workplace pension to its Sharia fund.
3. Open a stocks and shares ISA: Wahed if you want it done for you, or an Islamic ETF on a low-cost platform if you are happy to choose.
4. Invest monthly and leave it for at least five years.
5. Once a year, purify dividends, re-check screening and pay Zakat on the zakatable portion.

Investments can fall as well as rise, and you may get back less than you put in. This guide is general information, not personal advice. For the bigger picture see our Islamic finance guide, and if you use an app like Revolut for trading, read Is Revolut halal? first.