All praise is due to Allah, blessings and peace be upon Prophet Muhammad and upon all his family and companions.
One aspect of treating parents kindly is doing all that is beneficial to them, yet leading them to be rewarded by Allah in the Hereafter is the best thing to do, and voluntary charity is a means of doing so.
A person, hoping for his parents to receive the reward of voluntary charity that he gives on their behalf, may resort to means over which there is no disagreement amongst Muslim scholars regarding the validity of receiving the reward on such act. Some of these means are:
First: Giving that charity to his parents as a gift, so as for them to give it as charity in return. This way, it is a charity that he gives to his parents even if they are well-off since it is both lawful and valid for voluntary charity to be given to the rich. According to [Al-Majmoo]: “It is permissible for a person to give voluntary charity to the rich .”Later on, the parents in question can regive that charity on their own behalf.
Second: Granting that sum to his parents, then being deputized by them to give it as a charity on their behalf, guarantees that the reward of such act of devotion is due to him as well as them.
Third: Granting the whole reward of that charity, or part of it to his parents in the form of a Du`aa (supplication) in which he should say, after giving the charity: ”O`Allah! I ask you to reward my parents as you did me.” Yet, the acceptability of that Du`a is up to Allah, The Almighty. For further details, kindly refer to [Al-Majmoo`, vol.15/pp.522) by An-Nawawi.
As regards giving charity on behalf of the living, scholars have disagreed on its permissibility, but the Hanafite and some of the Hanbali scholars have permitted it.
In the book entitled, [Al-Bahar Al-Raeq]: “It is permissible for a person to dedicate the reward of his fast, prayer, and charity to the living as well as the dead, and that reward is theirs according to Ahl As-Sunnah wa'l Jama'ah (Those holding to the sunnah of the Messenger),and the same view is mentioned in the book entitled, [Bada`I Al-Sana`i” by Al-Kassani] .
Therefore, it does not matter whether the person intended in the reward is dead or alive. It also indicates that if a person makes the intention on behalf of another, or on behalf of himself, then dedicates it to another is the same thing.” According to one of the Hanbali books called (Zaad Al-Mostakna`i): “Any act of devotion whose reward is intended for dead or living people is to their benefit before Allah.”
Accordingly, a person who wants to give charity on behalf of his living parents should give it to them as a charity so that they could give it to others as charity in return in order for all of them to receive the reward. Muslim scholars have agreed on this in terms of validity and reward. And Allah Knows Best.