ZAKATH:
It is permissible to give the Zakat to deserving relatives. The Prophet peace be upon him said, "Your relatives deserve more your goodness" But it is not allowed to give Zakat to one's own children, grand-children or parents and grand-parents. The husband and wife also cannot give Zakat to each other. Because it is your duty to spend on these relatives like you spend on your own needs. You cannot give Zakat to your own self, similarly you cannot give Zakat to these relatives who come under the category of dependents.
However, other non-dependent relatives such as brothers, sisters, uncles, aunts, cousins, nephews, etc., can receive the Zakat if they are poor and need some financial help. The person who gives the Zakat must make an intention that the amount he/she is giving is for the purpose of Zakat, but the recipient does not have to be informed about it. It is better to give the charity to an individual in a respectful manner without hurting his/her dignity. If you have some relatives who need your help, you should help them from Zakat or from some other Sadaqat.
You may give them the money yourself quietly or you may give them through some other indirect ways. Allah says in the Qur'an "If you disclose your charity, it is well, but if you conceal it and make it reach to those who are really in need that is best for you. It will remove from you some of your sins and Allah is well-acquainted with what you do." (Al-Baqarah 2:271)
Allah subhanahu wa ta'ala has explained eight categories for the distribution of the Zakat funds. These are:
1. The poor who have some money but not enough for their basic needs.
2. The destitute or people who lost their means of livelihood.
3. The Zakat collectors or Zakat collection agencies who may need some funds to spend on the collection and distribution of the Zakat funds.
4. New Muslims or those whose hearts need to be reconciled to Islam.
5. To free the slaves or help the prisoners or their families.
6. People who are under heavy debt and need help to recover.
7. The travelers who may need some help to reach to their destination or the foreign students who cannot receive funds from their homes to complete their studies.
8. In the cause of Allah, such as Da'wah etc.
In fact it is superior to give Zakah to one's needy relatives as this is also a means of maintaining family ties.
ALLAH KNOWS THE BEST.
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