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Al-Baqarah 2:215

يَسْأَلُونَكَ مَاذَا يُنفِقُونَ ۖ قُلْ مَا أَنفَقْتُم مِّنْ خَيْرٍ فَلِلْوَالِدَيْنِ وَالْأَقْرَبِينَ وَالْيَتَامَىٰ وَالْمَسَاكِينِ وَابْنِ السَّبِيلِ ۗ وَمَا تَفْعَلُوا مِنْ خَيْرٍ فَإِنَّ اللَّهَ بِهِ عَلِيمٌ ٢١٥

Yasaloonaka matha yunfiqoona qul ma anfaqtum min khayrin falilwalidayni waalaqrabeena waalyatama waalmasakeeni waibni alssabeeli wama tafAAaloo min khayrin fainna Allaha bihi AAaleemun

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They ask you what they should spend (in the way of Allah). Say: ‘Whatever wealth you spend (is right), but the deserving ones are your parents and close relatives and orphans and the needy and the wayfarers. And whatever good you do, Allah indeed knows it full well.’ (2:215)

Who deserves the Nafaqah (Spending or Charity)

Muqatil bin Hayyan said that this Ayah was revealed about the voluntary charity. The Ayah means, `They ask you (O Muhammad ) how they should spend,' as Ibn `Abbas and Mujahid have stated. So, Allah explained it for them, saying:

قُلْ مَآ أَنفَقْتُم مِّنْ خَيْرٍ فَلِلْوَلِدَيْنِ وَالاٌّقْرَبِينَ وَالْيَتَـمَى وَالْمَسَـكِينَ وَابْنِ السَّبِيلِ

(Say: "Whatever you spend of good must be for parents and kindred and orphans and Al-Masakin and the wayfarer,") meaning, spend it on these categories or areas. Similarly, a Hadith states (that those who deserve one's generosity the most, are):

«أُمَّكَ وَأَبَاكَ وَأُخْتَكَ وَأَخَاكَ ثُمَّ أَدْنَاكَ أَدْنَاك»

(Your mother, father, sister, brother, the closest and then the farthest (relatives).)

Maymun bin Mihran once recited this Ayah (2:215) and commented, "These are the areas of spending. Allah did not mention among them the drums, pipe, wooden pictures, or the curtains that cover the walls."

Next, Allah said:

وَمَا تَفْعَلُواْ مِنْ خَيْرٍ فَإِنَّ اللَّهَ بِهِ عَلِيمٌ

(...and whatever you do of good deeds, truly, Allah knows it well.) meaning, whatever you perform of good works, Allah knows them and He will reward you for them in the best manner, no one will be dealt with unjustly, even the weight of an atom.

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Quran 2:215 — Verse translation, and Tafsir - onegodpath.com