1. What is a registered charity?
A registered charity is a charitable organization, public foundation, or private foundation that was established in Canada and is resident in Canada. It is operated exclusively for charitable purposes (i.e., the relief of poverty, the advancement of education, the advancement of religion, or other purposes that benefit the community in a way the courts have said are charitable) and must devote its resources to charitable activities. A registered charity has received a registration number from the Canada Revenue Agency and is exempt from paying tax on its revenue. It can issue official donation receipts for income tax purposes for gifts that it receives.
2. How do I verify if a charity is registered?
Ask the charity for its registration number, and confirm its status by consulting the CRA Charities Listings, or by calling the Canada Revenue Agency at 1-800-267-2384.
3. What is the main difference between a non-profit organization and a registered charity?
Registered charities must fit into one of four categories of charitable purposes: the relief of poverty, the advancement of education, the advancement of religion, or other purposes that benefit the community in a way the courts have said are charitable. Non-profit organizations may not fit into one of the four categories of charitable purposes but may have purposes such as social welfare, civic improvement, pleasure, or recreation. Non-profit organizations cannot issue official donation receipts for gifts that they receive.
4. Can a registered charity lend its registration number to another registered or non-registered charity?
No. Under no circumstances should a registered charity lend its registration number to another organization for receipting purposes. A charity that lends its registration number risks losing its charitable registration. A donor who accepts a falsified official donation receipt will risk having the tax credit disallowed and may be subject to fines.
5. Is a charity required to issue an official donation receipt?
No. However, the Canada Revenue Agency advises charities to notify potential donors of any circumstances in which they will not issue an official donation receipt. Donors cannot claim a charitable tax credit or deduction unless they have an official donation receipt.
6. To whom must an official donation receipt be addressed?
Generally, the official donation receipt can only be issued to the true donor of the gift to a charity. If a donation is made by a cheque in both spousal names, an official donation receipt can be issued in either name. If a corporation sends a donation to a charity, the official donation receipt can be made to the corporation owner only if he has sent a personal cheque. If the corporation is donating money that has been collected from its employees, and there is a written declaration to prove this, the charity can issue the official donation receipt in each donor’s name.
7. How can I replace a lost official donation receipt?
If you lose your official donation receipt, you can ask the charity to issue a replacement. You should receive a replacement receipt which contains all the required information plus a note to the effect that it “cancels and replaces receipt No. (the serial number of the lost receipt is inserted here)
8. If the charitable status of a charity to which I have recently made a donation has been revoked, can I still claim my tax credit?
If the organization was registered during the time of your donation, and if your receipts genuinely reflect the amount you gave, you can still claim your tax credit. Please note that when a charity is revoked, the organization may donate its assets to another eligible donee; otherwise, the assets are collected as tax.
9. What if I get something in return for my donation?
When a registered charity provides you with something of value in return for making a donation, the eligible amount of your donation for income tax purposes is generally reduced. This amount will be reflected on your official donation receipt. For example: You donate $1,000 to the Anytown Ballet Company, which is a registered charity. In gratitude, the company provides you with three ballet tickets worth $50 each, for a total value of $150. These tickets are considered an advantage of $150. The eligible amount of your donation for calculating your tax credit is therefore $850 ($1,000 – $150).
10. Can a charity return a donation?
In most cases, a registered charity cannot return a donor’s gift. At law, a gift transfers ownership of the money or other gifted property from the donor to the charity. Once the transfer is made, the charity is obliged to use the gift in carrying out its charitable purposes. On occasion, though, a charity may be obliged by law to return gifts to donors. This can happen, for instance, when a charity asks the public to contribute to a special project and later events make it impossible to carry out the project.
11. Do I have to claim donations the same year that I make them?
No. You can carry forward any donations you do not claim in the current year and claim them on your return for any of the next five years, but you can only claim donations once. You have to claim tax credits for gifts you carried forward from a previous year before you claim tax credits for gifts in the current year. If you are claiming a carryforward, attach a note to your return indicating the year of the return in which you submitted the official donation receipt, the portion of the eligible amount you are claiming this year, and the amount you are carrying forward.
13. I’ve been invited to participate in a donation program that will make me a profit. Is it safe to participate?
There are serious risks associated with this type of program – See What are donation schemes and why should I avoid them? to learn more.
14. How do I report charity fraud?
Report fraud to the Canadian Anti-Fraud Call Centre by calling 1-888-495-8501. You can also call the CRA’s toll free numbers in Canada: 1-800-267-2384 (English) or 1-888-892-5667 (bilingual).
15. Is it safe to donate online?
Ottawa, Ontario, June 29, 2012… The Canada Revenue Agency (CRA) announced today that the average refund for the 2011 tax-filing season is more than $1,580—an increase of about $70 per person since last year.
Many Canadians are receiving their refunds in as little as seven days by switching to electronic filing. Among the 25.4 million returns received as of June 14, 16.8 million were filed using electronic services, which is up from 16.1 million at the same time last year. Paper filing continues to decrease in popularity. So far this year, 8.6 million paper returns have been filed compared to the 8.8 million that were filed last year. The CRA’s electronic services are the quickest way for Canadians to file, and these services are easy and secure to use. Those who sign up for direct deposit through the CRA’s online services are able to receive their refunds even faster.
Tax filers are discovering the benefits of using the CRA’s electronic services year-round and not just during tax-filing season. Using electronic services, such as My Account and Quick Access, allows you to track your refund, view your benefit and credit payments and your registered retirement savings plan information, set up direct deposit, and much more. For more information on electronic services, go to www.cra.gc.ca/electronicservices.
This year, new tax credits such as the volunteer firefighters’ tax credit and the children’s arts tax credit helped Canadians reduce their taxes. Volunteer firefighters were able to claim up to $3,000 on their tax return and parents were able to claim up to $500 for enrolling their children in prescribed programs. Other credits such as the public transit tax credit and pension income splitting continue to help Canadians keep more money in their pockets.
The CRA takes this opportunity to thank Canadians who filed their income tax and benefit return on time. If you missed the April 30 filing deadline, it is in your best interest to file as soon as possible to receive benefit payments such as the GST/HST credit or the Canada child tax benefit and to avoid paying more penalties and interest charges.
The Honourable Gail Shea, Minister of National Revenue, today highlighted that Canadians who have been affected by devastating weather conditions can apply for relief from the Canada Revenue Agency (CRA) if they are having difficulty meeting their tax obligations because of extreme weather events.
“Our Government understands that severe weather events can prevent Canadians from meeting their tax obligations. Recently, Canadians from several regions, including British Columbia, the Yukon, and Saskatchewan, have had to rebuild because of events such as flooding and severe wind,” said Minister Shea. “The taxpayer relief provisions ensure that all Canadians receive fair tax treatment, while they are recovering from the damage resulting from natural catastrophes.”
All Canadians have access to the CRA’s taxpayer relief measures and will be considered for relief if they miss a payment or filing deadline because their lives were disrupted by uncontrollable weather events, including forest fires caused by lightning strikes, tornadoes, flooding, landslides and hurricanes.
The taxpayer relief provisions use a balanced approach to help taxpayers to resolve tax issues that arise through no fault of their own. Under these provisions, any taxpayer can apply to the CRA to have interest and/or penalties waived or cancelled in situations where they are unable to file a tax return and/or make a payment on time due to a natural disaster or other extraordinary circumstances beyond their control.. The CRA will consider these requests on a case-by-case basis.
Adequate records have to be kept by individuals, partnerships, corporations, organizations and trusts, as identified below:
persons carrying on a business or engaged in commercial activity;
persons required to pay or collect taxes or other amounts such as payroll deductions and goods and services tax/harmonized sales tax (GST/HST) under the Income Tax Act, the Excise Tax Act, the Excise Act 2001, the Employment Insurance Act, the Canada Pension Plan, the Air Travellers Security Charge Act and the Softwood Lumber Products Export Charge Act, 2006 (SLPECA);
persons required to file an income tax or GST/HST return;
persons who apply for GST/HST rebates or refunds;
payroll service providers;
a registered agent of a registered political party;
an official agent for a candidate in a federal election;
agents authorized under the Senate Appointment Consultation Act;
school authorities; and
qualified donees such as:
a registered charity;
a registered Canadian amateur athletic association;
a housing corporation resident in Canada and exempt from tax under Part 1 of the ITA because of paragraph 149(1)(i) that has applied;
a municipality in Canada;
a municipal or public body performing a function of government in Canada that has applied;
a university outside Canada that is prescribed to be a university the student body of which ordinarily includes students from Canada; or
a charitable organization outside Canada to which Her Majesty in right of Canada has made a gift.
You could get up to $265 for 2011 for each adult and child in your family to help with the sales tax you pay on goods and services. This amount is adjusted for inflation each year.
If you pay rent or property tax, you could get up to $917 for 2011 to help with the sales tax you pay on energy and the property taxes you paid and qualifying seniors can get up to $1,044 for 2011.
Families living in Northern Ontario can get up to $204 for 2011 to help with their home energy costs, as it is often higher in the North due to more severe winters. If you are single, you can get up to $132.
You must be eligible to at least one of the benefits (OSTC, OEPT or NOEC) to eligible to receive OTB.
You must complete Ontario Form ON-BEN which is part of the 2011 T1 General Income Tax and Benefit Return package and file it with the Canada Revenue Agency (CRA). If file your individual tax returns later than April 30th may result in delay in receiving OTB payments.