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Shirkah tul Aa'maal

What is meant by Shirkah tul Aa'maal? How does it work in practice?

Shirkah tul Aa'maal is a partnership in services. Under Shirkah tul Aa'maal, two or more individuals enter into a partnership to provide a service. While there may or may not be an initial capital contribution to determine the size of the partners’ share, an agreed-upon ratio determines how profits distribute.

For example, ten partners enter into an agreement to publish a magazine. The six freelance writers and four full-time managers may decide to distribute profits so that writers receive 8% each of profits and the managers receive 13% each of profits.

In a service partnership partners may act on behalf of one another as agreed upon (e.g. buying, selling, managing, etc.) and no partner may refuse participation in the provision of agreed upon services.

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