Giving charity is highly recommended in the Qur’an and Sunnah and the reward for charitable acts is great. Although everything including one’s financial possessions belongs to God in reality, the Qur’an presents giving charity as offering a loan to God:
Who is the one that lends to God a good lending so that God may give him double? (57:11)
In addition to voluntary charities, there are certain types of charity that are obligatory. For example, one type of almsgiving is zakāt, a wealth tax of a small percentage (usually 2.5%). Paying zakāt is not a gift for the poor but rather is their due right that must be observed:
And in their properties is the right of the beggar and the destitute (51:19).
Imam Ali also said:
God the Glorified has fixed the livelihood of the destitute in the wealth of the rich. Consequently, whenever the destitute remains hungry, it is because some rich persons have denied him his share.1
Those whose possessions of certain amounts of wheat, barley, dates, raisins, gold, silver, camels, cows and sheep surpass certain quantities must pay zakāt on a yearly basis to the less fortunate amongst their relatives, the orphans, the needy, the wayfarers and etc. Zakāt may be spent for food, shelter, education, health care, orphanages and other public services.
It is noteworthy that in many verses, paying zakāt is enjoined immediately after the command to perform one’s
prayers (salāt), and as a sign of faith and belief in God. Paying zakāt is an act of worship, so it must be performed for the sake of God. Therefore, not only does it help the needy and contribute to the establishment of social justice and development, but it also purifies the soul of those who pay it. The Qur’an says:
Take alms from their wealth in order to purify and sanctify them (9:103).
Khums: Shi‘a Muslims also believe in another obligatory tax, called khums. In Arabic Khums literally means one fifth. It is a 20% tax on the excess profit that a person annually makes. At the end of one’s financial year, one pays 20% of all one’s earnings after deducting house-hold and commercial expenses.2 The obligation to pay khums has been mentioned in the Qur’an:
And know that whatever profit you may attain, one fifth of it is assigned to God and the Messenger, and to the near relatives [of the Messenger] and the orphans, the destitute, and the wayfarer, if you have believed in God and that which We sent down to our servant [Muhammad] (8:41).
Sunni Muslims usually believe that the verse only refers to what Muslims earn when they win a battle (booty) and consider it to be a type of zakāt.
According to Shi‘i jurisprudence, half of the khums belongs to the twelfth Imam, the remaining member of the household of the Prophet and his successor, and the other half to the poor descendants of the Prophet, called “sayyids”. Khums must be spent under the supervision of a Shi‘a religious authority (marji‘ al-taqlīd), i.e. the grand jurist (Ayatollah) that one follows in practical issues. This is to make sure that it is spent in a way with which Imam Mahdi is pleased. The portion belonging to the Imam is usually spent on Islamic seminaries and other educational projects such as publishing useful books, or building Mosques, Islamic centres, and schools.
1 Nahj al-Balāghah, edited by Fayḍ al-Islam, Wise sayings 320.
2 There are other cases mentioned in Shi‘a jurisprudence in which paying khums becomes obligatory. What has been mentioned above is the most popular one.
Discovering Shi’i Islam Mohammad Ali Shomali 9th Edition