Linguistically, the root of the word Zakat implies purification, blessing and growth. Allah has stated in the Quran, sadaqaAllah has stated in the Quran,
Indeed whosoever purifies himself (tazakkaa) shall achieve success
Another word used in the Quran and hadith for the Zakat is sadaqa. This word is derived from sidq (the truth). Siddiqi explains the significance of these two terms as they are used here,
Both these words are highly meaningful. The spending of wealth for the sake of Allah purifies the heart of man of the love of material wealth. The man who spends it offers that as a humble gift before the Lord and thus affirms the truth that nothing is dearer to him in life than the love of Allah and that he is fully prepared to sacrifice everything for His sake.
The believers, men and women, are helpers and supporters of one another, they enjoin what is right and forbid what is evil, they offer their prayers perfectly, they give the Zakat and they obey Allah and His Messenger. Allah will bestow His mercy on them. Surely, Allah is All-Mighty, All-Wise.
It also purifies the wealth of the person by removing any evil effect from it. The Prophet (peace be upon him) once said, Muslims who do not pay their Zakat are not only harming themselves but they can actually harm the entire Muslim Nation. The Messenger of Allah (peace be upon him) said, 
And let not those who covetously withhold of that which Allah has bestowed on them of His Bounty (wealth) think that it is good for them. Nay, it will be worse for them. The things which they covetously withheld shall be tied to their necks like a collar on the Day of Resurrection. And to Allah belongs the heritage of the heavens and the earth, and Allah is Well-Acquainted with all that you do
[There are] those who hoard up gold and silver and spend it not in the way of Allah– announce unto them a painful torment. On the Day when that wealth will be heated in the fire of hell and it will brand their foreheads, flanks and backs. [It will be said to them], ‘This is the treasure which you hoarded for yourselves. Now taste of what you used to hoard
The Amount of Money to be Given as Zakat
Zakat is obligatory upon different forms of wealth, such as money, crops, fruits, livestock and treasures found in the earth. In today’s world, the most common form of wealth is that of money. Zakat is to be paid on one’s money if that amount of money reaches the minimum required for Zakat and if it has been in the person’s possession for a year’s time. The amount to be paid on such holding is 2.5%.
The minimum required holding of wealth before one is obligated to pay Zakat is known as the nisaab. There is actually a distinct nisaab for gold and for silver. Today, people hold cash and currency rather than gold or silver. This has led to some difference of opinion as to whether the nisaab for cash should be based on its gold equivalent or its silver equivalent. If gold is taken as the basis, Zakat is only obligatory if the amount of gold one possesses reaches twenty mithqaals or if a person holds its equivalent value in currency. If the Muslim possesses this amount of money for a year’s time, he pays 2.5% once in that year as Zakat.
Zakat is distributed to specific categories of people. Allah has mentioned those categories in the following verse:
The alms are only for the poor, the needy, those employed to collect (the funds), and to attract the hearts of those who have been inclined (towards Islam); and to free the captives; and for those in debt; and for Allah's Cause, and for the wayfarer (a traveler who is cut off from everything); a duty imposed by Allah. And Allah is All-Knower, All-Wise
In general, most mosques have committees and accounts for Zakat. If a Muslim gives them his Zakat payment, informing them that it is Zakat, it should then be distributed to the proper recipients and the Muslim would have fulfilled his responsibility to Allah.
- Siddiqi, vol. 2, p. 465.
- Recorded by ibn Khuzaima and al-Tabaraani. According to al-Albani, it is hasan. Al-Albani, Sahih al-Targheeb wa al-Tarheeb, vol. 1, p. 312.
- Recorded by ibn Majah. According to al-Albani it is authentic. See Muhammad Nasir al-Din al-Albani, Silsilat al-Ahadeeth al-Saheeha (Beirut: al-Maktab al-Islami, 1979), vol. 1, hadith no. 106,
- Contemporary estimates range from 85 to 93.6 grams.