Zakat is one of the five pillars of Islam. It is mentioned well over 70 times in our Glorious Quran, and after Salah, it is the most important act in Islam.
The meaning of the term “Zakat” is “purity” or “cleanliness.” You must set a portion of your wealth for the poor and needy so that one’s soul and wealth is purified. Wealth is impure in Allah’s eyes if you do perform your Zakat. Moreover, your soul would be impure because not giving Zakat means you are ungrateful.
You must perform your Zakat in a monetary manner. Those who fulfill this duty are promised abundant reward in this world and the hereafter. Evading your Zakat means consequences as warned in our Glorious Quran.
The benefits of Zakat include:
It reminds Muslims of the fact that whatever wealth they may possess is due to the blessings of Allah and as such it is to be spent according to the His commands.
Zakat functions as a social security for all. Those who have enough money today pay for what they have. If they need money tomorrow they will get what is necessary to help them live decently.
Zakat payer pays his dues to Allah as an act of worship, a token of submission and an acknowledgment of gratitude. The receiver of Zakat receives it as a grant from Allah out of His bounty, a favor for which he is thankful to Allah.
Economically, Zakat is the best check against hoarding. Those who do not invest their wealth but prefer to save or hoard it would see their wealth dwindling year after year at the rate of the payable Zakat. This helps increase production and stimulates supply because it is a redistribution of income that enhances the demand by putting more real purchasing power in the hands of poor.
Source: Easy Islam, http://www.easyislam.com/zakat.asp
Moreover, Zakat obligatory upon:
Every adult who is sane, free and Muslim.
Wealth must be in excess of a specified amount, excluding personal belongs
It should be possessed for one complete lunar year.
Zakat should of some productive nature that derives benefit or profit, i.e, merchandise, gold, livestock, etc.
For more information on calculating Zakat, visit Easy Islam.
Allah tells us of the virtue of giving Zakat in the Quran:
"The parable of those who spend their wealth in the way of Allah is that of a grain of corn. It grows seven ears and each ear has hundred grains. Allah increases manifold to whom He pleases." (Quran 2:261)
Benefits derived from giving Zakat include: the pleasure of Allah, increase in wealth and protection from losses, Allah’s forgiveness and blessings, protection from the wrath of Allah and from a bad death, shelter on the Day of Judgment, and security from 70 misfortunes.
The Quran also tells us the punishment of not giving Zakat:
"And there are those who hoard gold and silver and do not spend it in the way of Allah, announce to them a most grievous penalty (when) on the Day of Judgment heat will be produced out of that wealth in the fire of Hell. Then with it they will be branded on their forehead and their flanks and backs. (It will be said to them) This is the treasure which you hoarded for yourselves, taste then the treasure that you have been hoarding." (Al-Quran 9:34-35)
Your Zakat must be paid by the end of Ramadan. There are many of us struggling through some tough economic times, but we still need to perform our Zakat. Remember, Zakat is contingent upon your income, and if you are unable to give Zakat in monetary form, you can give something of value away, like livestock or business services.
For some examples on how to calculate Zakat, visit Iman’s Corner at the Islamic Center of Raleigh.
In the meantime, I hope your Ramadan is blissful and beautiful. Isha’allah.