A charitable organization registered with the Ministry of Social Affairs aims to assist underprivileged patients in receiving high-quality medical services by providing a dedicated charitable medical center. Is it permissible for this charitable organization to:

1. Use zakat funds to settle accumulated debts owed to entities such as the Social Insurance Authority, the Ministry of Electricity, and the Tax Authority?
2. Use zakat funds to upgrade medical service facilities for both financially capable and underprivileged patients, including accommodations, operating rooms, and infrastructure?

It is impermissible to use funds intended as zakat to settle the organization’s accumulated debts or to upgrade its medical services; such expenses should be covered through general and ongoing charitable donations. This is because the aim of zakat is to aid the poor and needy in a manner that prioritizes their basic needs, such as food, clothing, shelter, living expenses, education, healthcare, and other necessities of life and not for the construction or improvement of facilities. This is supported by the words of Prophet Muhammad (peace and blessings be upon him) who exclusively mentioned the poor and the needy when he addressed Mu‘adh (may Allah be pleased with him) before sending him to Yemen. He told Mu’adh, "Inform them that Allah has enjoined upon them a charity (zakat) that is to be taken from their wealthy and returned to their poor” (Bukhari and Muslim).

The wisdom behind the legislation of zakat

Zakat is one of the pillars of Islam, whose categories of expenditure have been clearly designated in the verse, "Indeed, the zakat expenditures are only for the poor and the needy, and those employed to collect [zakat], and for bringing hearts together [for Islam], and for freeing captives [or slaves], and for those in debt, and for the cause of Allah, and for the [stranded] traveler—an obligation [imposed] by Allah. And Allah is All-Knowing and Wise” (Quran, 9:60).

The majority of scholars stipulate that zakat must be transferred to the ownership of the poor and needy, allowing them to decide how best to fulfill their needs. This condition of direct transfer is emphasized in sources such as:

• Al-Mabsut, by the Hanafi scholar al-Sarakhsi,
• Mughni al-Muhtaj, by the Shafi’i scholar Shams al-Din al-Khatib al-Shirbini, and
• Al-Mughni, by the Hanbali scholar Ibn Qudamah.

Therefore, the primary aim of zakat is to suffice the poor and needy and sustain their lives and livelihoods—to support the individual’s well-being rather than to develop physical structures. Sufficing the poor and the needy involves providing essentials such as food, clothing, shelter, education, healthcare, and all other necessities. Accordingly, zakat funds should prioritize such expenditures.

 

The ruling on settling the social charity’s debts using zakat money

It is impermissible to allocate zakat funds to settle the charity's accumulated debts owed to the Social Insurance Authority, the Ministry of Electricity, and Tax Authority, and to improve medical service facilities. These should be covered by donations and general and ongoing charitable funds, which have broader scope of application than zakat. It is permissible to give them to the poor and others alike, and they do not require direct transfer of ownership. Prophet Muhammad (peace and blessings be upon him) said,
"When a person dies, their deeds come to an end except for three: ongoing charity, beneficial knowledge, or a righteous child who prays for them” (Muslim).

Ongoing charity (sadaqah jariyah) refers to any form of charity whose benefits and rewards continue over time. Examples include endowments (awqaf) or similar initiatives that provide continuous benefit.

 

Recommended approach to managing funds

Egypt’s Dar al-Ifta recommends that three separate funds be established:

1. An ongoing charity fund: This fund would receive donations whose profits or yields would support charitable organizations, hospitals, and the treatment of those who seek their services.
2. General charity fund: This fund would finance the construction, establishment, maintenance, and development, and to ensure that these facilities are presented in a manner befitting Muslims structurally, architecturally, and aesthetically. It would also cover all related financial obligations.
3. Zakat fund: The income from this fund is to be used to purchase medical equipment, medicine, treatment and accommodation expenses, food and drink for poor patients, as well as the costs of surgical procedures, medical imaging, and similar needs.

 

The ruling

It is impermissible to use zakat funds to settle the accumulated debts of the above-mentioned organization or to improve the facilities used to provide services provided to patients—whether financially able or not. These expenses should instead be covered by general or ongoing charitable donations.

And Allah Almighty knows best