Shariah-compliant trusts and foundations

Your situation

Families usually come to this with one of these in mind:

• a family business that should stay whole for the next generation, rather than be divided on the founder's death into the fixed shares
• a wish to provide for a spouse, a daughter or a dependant beyond the share the rules give them, without breaking those rules
• assets in the UAE and in countries whose courts may not recognise Islamic inheritance at all
• a charitable purpose the family wants to fund for good, in the tradition of the waqf

The rules the structure has to respect

• Fixed shares. The UAE's personal status law for Muslims (Federal Decree-Law No. 41 of 2024, in force 15 April 2025) sets the share of the estate each heir receives. [1]
• The one-third limit. A will can cover up to one third of the estate. A gift by will of more than that, or to someone who is already an heir, needs the other heirs' consent. [1]
• Lifetime gifts. A gift made during the founder's lifetime (hibah) can fund a foundation or trust. Whether a UAE court would later treat such a gift as a way round the fixed shares is not settled: in January 2021 the DIFC Court of Appeal declined to answer that question. [2]
• What the structure may hold and earn. Shariah-compliant structures hold assets, and earn income, from permitted activities only, and are financed without interest. In the UAE's financial sector, the Shari'ah Standards of AAOIFI have been mandatory for Islamic financial institutions since 1 September 2018. [4]

The options

• A DIFC or ADGM foundation with Shariah terms. The charter can set distributions in line with the fixed shares, name a Shariah adviser and record how the council takes Shariah guidance. The DIFC Court of Appeal has confirmed that a trustee may rely on a Shariah adviser. [2][3]
• A Shariah-compliant trust. Under the DIFC or ADGM trust laws, with a trust deed drafted to the same rules and a licensed trust company as trustee. [2]
• A family waqf. An endowment registered in the UAE under Federal Law No. 5 of 2018 on Waqf. In Dubai, land or property can be registered as a family or charitable endowment with the Dubai Land Department, for a fee of AED 2,000 per plot, and Awqaf Dubai (the Awqaf and Minors Affairs Foundation) supervises registered endowments. [5][6][7]

What we do

• We list the family's assets by country and owner, and record which inheritance law reaches each one.
• We set out how a foundation, a trust and a waqf compare for your family, and what each can and cannot do under the fixed shares.
• We design the structure and its funding, and the order in which assets move into it.
• We form and administer the UAE companies the structure holds, including RAK ICC companies, and keep their accounts.
• We coordinate the Shariah adviser, the law firm, the registered agent and the trustee you appoint to one timetable.

What a licensed partner does

• A Shariah scholar or Shariah advisory firm reviews the structure and its terms, and confirms they comply.
• A law firm drafts the charter, trust deed or waqf document.
• A licensed trust company acts as trustee. You appoint it directly.
• A licensed registered agent files a DIFC or ADGM foundation. You engage it directly.
• The Dubai Land Department and Awqaf Dubai register and supervise a waqf over Dubai property. [6][7]

You appoint and contract with each one directly. Under a Full Mandate, we run the whole plan.

Related guides

• Inheritance law in the UAE →
• DIFC, ADGM or RAK ICC foundation: which suits your family? →
• Wills in Dubai and the UAE →
• Trusts and foundations in the UAE →

Questions people ask

Can a Muslim use a trust or foundation in the UAE?

Yes. ADGM has said its foundations are flexible enough for Shariah-compliant use, and the DIFC Court of Appeal has confirmed a trustee may rely on a Shariah adviser. Whether a lifetime gift into the structure can be challenged under the inheritance shares is not settled. [2][3]

What is a family waqf?

An endowment the founder dedicates to themselves, their children or other named people, under the UAE's waqf law. In Dubai it can be registered over land or property with the Dubai Land Department. [5][6]

How much of my estate can I leave by will?

Up to one third, under the UAE's personal status law for Muslims. More than that, or a gift to an heir, needs the other heirs' consent. [1]