Zakat is a compulsory giving of a set proportion of one’s wealth to charity. It is regarded as a type of worship and of self-purification. Zakat is the third pillar of Islam and many prophetic traditions command muslims to pay zakat. The prophet (peace be upon him) said:

رُوِيَ عَنِ النَّبِي أَنَّهُ قَالَ: أَلزَّكَاةُ قَنْطَرَةُ الإِسْلاَمِ، فَمَنْ أَدَّاهَا جَازَ الْقَنْطَرَةَ وَمَنْ مَنَعَهَا إِحْتَبَسَ دُوْنَهَا وَهِيَ تُطْفِئُ غَضَبَ الرَّبِّ.

It has been narrated from the Noble Prophet (blessings of Allah be upon him and his family), that he said: “Zakat is the bridge of Islam; so whoever performs it can cross the bridge and whoever withholds it will be detained beneath it. And it (Zakat) extinguishes the anger of the Lord.”
Bihar al-Anwar, Volume 74, Page 405

Zakat doesn’t refer to charitable gifts given out of kindness or generosity, but to the systematic giving of 2.5% of one’s wealth every year to benefit the poor.