On this day, Muslims perform two rakaats of prayer, meet one another, shake hands and embrace and give charity to the poor and needy. Islam teaches protecting the poor, helping the helpless, and easing the pain and sufferings of orphans and the meek at every turn, and they should not be forgotten, especially on the day of Eid. That is why Prophet Mohammad (Sallallahu Alaihi wa Sallam) ordered us to pay the Sadqa-e-Fitr money to the poor before performing the Eid Salaah so that Muslims remember the poor people on this occasion and include them in their happiness.
It is reported in a Prophetic hadith that, on the day of `Eid Al-Fitr, the angels stand on both sides of the roads and proclaim,
"O believers, walk toward your Lord, Who is the Most Generous. He favors you with goodness and gives you great reward. He commanded you to pray during the night and fast during the day. Now that you have obeyed Him, come and receive your rewards." (Hadith from book At-Tabarani).
As the believers finish the `Eid Prayer, the angels say,
"Allah has forgiven you. Return to your homes with the best of good and glad tidings. This is the day of reward. This day is called the day of reward in heaven as well." (Hadith from book At-Tabarani).