Canadian charities are not required to issue charitable donation receipts by a certain deadline (or at all!) – but the Canada Revenue Agency (CRA) suggests that you issue them by February 28, 2013, so donors can claim their 2012 tax credit. Even better – for complete clarity with your donors, try and make it a policy to issue receipts by December 31 so the previous year’s receipts bear an issue date of the same year.
Tickets for special events are often not fully receiptable, because patrons receive advantages from attending. Check our Q & A for split receipting rules.
Charities are not allowed to issue charitable donation receipts for gifts of donated services or volunteer time. Check our Q & A post for details.
The Charities Directorate phone number is 1-800-267-2384. Call them with your questions on tax receipting, filing your T3010 and other matters.
Donations received by December 31 are eligible for a tax credit in that year. Make sure that your receipting is up to date at the calendar year-end so your donors can claim their credit.
Charities are not obliged to issue charitable donation receipts. Some charities use a minimum threshold, e.g. donations above $20 are receipted.
The Canada Revenue Agency sets requirements for records retention, for charities and others. Most financial documents must be retained for six years from the end of the tax year to which they relate. There’s a lesser two-year requirement for official donation receipts (other than receipts for 10-year gifts). Here’s the CRA citation.
Those services might be valuable. Charities benefit from many types of “pro bono” assistance – accounting, legal, grant writing, performing, design… But the Canada Revenue Agency’s rules are clear: charitable donation receipts can be issued only for gifts of property, not for gifts of services.
The fact that there might be a clearly understood and publicized fee (i.e. the fair market value is unambiguous) does not change this ruling.
There is something you can do, though: you can pay your supporter for their services, and they can donate the money back to you. These transactions create a gift of property, which is eligible for a charitable donation receipt.
It’s not good enough to exchange an invoice marked “paid.” Your supporter must invoice you for the services (and you must retain this invoice as part of your accounting records). You must actually pay the service provider, and they must give you the donation of money (and your banking records must show these transactions).
This process requires the donor to receive payment, which must be declared by them as taxable income. The charitable donation receipt confers a tax credit against this income.
The whole process is often referred to as a “cheque exchange.”
Here are a couple of citations from the CRA website: