Zakat ul-fitr or sadqat ul-fitr means "the purifying charity of breaking the fast". It is a prescribed amount of food given by the Muslims during the last few days of Ramadaan or on the morning of `Eed prior to the prayer.
Zakaat ul-fitr was ordained by Allaah for two reasons:
Ibn `Abbaas (R) reported:"The Messenger of Allah(ﷺ) ordained zakaat ul-fitr to purify the fasting person from indecent words or actions, and to provide food for the needy. It is accepted as zakaah for the person who gives it before the `Eed prayer; but it is a mere sadaqah for the one who gives it after the prayer. Abu Dawood 1609 and Ibn Majah 1827
Zakat ul-fitr is a fard (obligation) for those capable of giving it. This is stated clearly in the hadeeth of Ibn `Umar(R) : "Allaah's Messenger(ﷺ) has ordained zakat ul-Fitr, in the amount of one saa` of dates or one saa` of barley, for the Muslims - slave or free, male or female, young or old; and he ordered that it be given before the people went out to the (`Eed ) prayer." Sahih al-Bukhari 1511
As for the person who does not have the financial ability to give it, he is exempt because of general texts in the Qur'aan and Sunnah, such as Allaah's saying:
The above hadeeths indicate that the amount of zakaat ul-fitr is one saa` of the various types of food that can be measured. There is one exception to this: In the case of wheat, the Messenger(ﷺ) commanded the people to give two mudds, which are equal to half a saa. This was practiced by Mu`aawiyah in Damascus, Sahih al-Bukhari 1508
[1 Saa is approximately 3kgs, This was the estimation of Shaykh Ibn Baaz (may Allaah have mercy on him), who reckoned the weight of zakaat al-fitr as being approximately three kilograms.] Majmoo’ Fataawa al-Shaykh Ibn Baaz, 14/200 and Al-Muntaqa min Fataawa al-Shaykh Saalih al-Fawzaan, 3/140
Some of the scholars have interpreted “food” (ta’aam) in this hadeeth as referring to wheat; others interpreted it as meaning the staple food of the country, whatever it is, whether it is wheat, corn, pearl millet or whatever. This is the correct view, because zakaah is a help from the rich to the poor, and the Muslim does not have to help with anything other than the staple food of his country. Undoubtedly rice is the staple food in the land of the Two Holy Sanctuaries (Saudi Arabia) and it is a good and valuable food; it is better than the barley that is mentioned in the text. Hence it is known that there is nothing wrong with giving rice as zakaat al-fitr.
It is not permissible to pay the value in money, according to the majority of scholars; this view has the stronger evidence. Rather it must be given in the form of food, as the Messenger(ﷺ) and his companions (may Allaah be pleased with them) did. This is also the view of the majority of the ummah.Majmoo’ Fataawa al-Shaykh Ibn Baaz, 14/200
The best time to pay Zakatul-Fitr is the time from dawn on 'Eid Day (the first day of the Month of Shawwal) until just before the 'Eid prayer, Sahih al-Bukhari 1503. However, those who give it before the morning of the 'Eid (i.e. a day or two before the 'Eid) have properly fulfilled the obligation. Those who give it away after the 'Eid prayer, it is considered as a voluntary charity (Sadaqah) only. In other words it is not counted as Zakatul-Fitr.
It has further been reported that Ibn `Umar used to give it out one or two days before the `Eed. This provides a basis for giving it a few days before the Eed. But it is wrong to give it too early in the month of Ramadaan. Doing that would conflict with its wisdom of being atonement of the sins during the month, and provision for the needy on `Eed ; it further conflicts with the practice of the sahaabah (R)
It is permissible to appoint individuals to collect zakaat ul-fitr from the people; it is also permissible to give from it to those collectors if they need and deserve it. Ibn `Umar (R) used to do so. Ibn Khuzaymah (al-Hilaalee)
Zakaat ul-fitr should be distributed to the miskeen (the needy), as was stated in the hadeeth of Ibn `Abbaas. A miskeen is not a person in complete poverty, but is one whose financial means are very limited.
Zakatul-Fitr, should be given to the poor and needy, and no one else, Shaykh al-‘Uthaymeen (may Allaah have mercy on him), as it says in al-Sharh al-Mumti’ (6/117)
See also: Scholars view on Zakat; Ramazaan; Eid or Eed;
`Eed regulations by `Ali Hasan al-Halabee's Ahkaam ul-`Eedayn fis-Sunnat il-Mutahharah;