Participation-based investment funds are investment funds that be constitute a portfolio of assets through monetary and capital market instruments that are compliant with the principles of participation finance. These funds include lease certificates (sukuk), real estate certificates, participation accounts, equities, precious metals, etc. One of the most important aspects regarding fund assets is that the equities to be included in the portfolios of participation-based investment funds must be in compliance with Shariah principles. Thus, the main activity areas of the company to be included in the portfolio must be suitable from Shariah’s perspective. Because of the exceptional circumstances arising from regulations or the necessity to sustain activities, companies with legitimate main activity areas but possessing a limited amount of non-compliant income or debt up to a certain threshold have been approved by the Shariah scholars for trading of their equities. However, it’s not permissible in Shariah for a Muslim to earn income through illegitimate means, it has been stated that the non-permissible earnings derived from prohibited sources owned by a company must be purified. At first, this view was discussed by a group of Shariah Scholars on a global scale in 1987, later it became more systematic with the development of various standards from the 1990s onwards. Subsequently, global Islamic stock market indices began to be established. On the Türkiye side, Bizim Menkul Degerler established an Islamic participation index in 2008. TKBB Shariah Board published standards for companies that could be included in the participation index in 2020. The calculation and management of participation indices were transferred to Borsa İstanbul with a decision taken in 2021. Thus, the TKBB Shariah Board which sets the standards for the participation index listing Shariah- compliant equities in Türkiye has expressed their opinions on the necessity of purifying non- permissible earnings derived from equity investments. Investors, who are trading equities within the framework of participation finance principles, can purify their non-permissible earnings based on the ratios that are announced to the public via the Public Disclosure Platform, in accordance with the standards published by the TKBB Shariah Board. Even standards published for purification, participation-based investment funds do not purify the non-permissible earnings arising from the equities which they trade; or provide information to investors about the ratio/amount of non-permissible earnings that must be purified on behalf of the investors. In this study, a proposal has been developed for the purification of non- permissible income generated from participation-based investment funds, with consideration for customer preferences, and their allocation towards social aid activities. In this context, opinions regarding the necessity of purifying non-permissible earnings generated in participation-based funds have been firstly discussed in this study. After that the outlook of the participation-based investment funds market in Türkiye was examined, aiming to determine the potential amount of non-permissible earnings generated in these funds. The proposal regarding the subject also takes part in the last section. As a result, it has been determined that the assets of participation based investment funds have become one of the fastest-growing capital market instruments among Islamic finance assets in Türkiye. Indeed, the assets of participation-based investment funds have reached 299.2 billion TL by June 2023, growing by 193% compared to the same month of the previous year and by 75% since the beginning of 2023. The size of the equity shares, which accounted for 8% of the fund assets, has reached 23 billion TL. In this regard, the amount of non-permissible earnings, that need to be purified from the equities included in participation-based investment fund portfolios, has been calculated as 371.6 million TL as of the beginning of 2023. Considering this amount, it is believed that the non-permissible earnings generated in participation-based investment funds could be more efficiently utilized if they were aggregated into specific social aid funds (such as earthquake funds, aid funds, or disaster relief funds) rather than being handled through individual actions. Moreover, it is also considered that this could have a positive impact on the public budget concerning social aid expenditures. When examining global practices related to the purification of Islamic investment funds; it is observed that in some countries, fund managers just give to inform investors about the amount that needs to be purified, and leave the purification process to the initiative of the investors. In some other countries, the non- permissible earnings portion is purified by fund managers, and the remaining fund revenues are transferred to investors. In this study, it is proposed that the purification of non- permissible earnings should be left to the preference of investors, and according to their preferences the purification of non-permissible income should be purified by fund managers. In this respect, the system envisioned in Türkiye would differ from global examples.