The Foundation will issue donation receipts for any cash donation over $15.00. If an individual has made a donation, the receipt will be issued in the name of that individual at their home address. If a corporation has made the donation, and IF a tax receipt is requested, the receipt will be issued in the company name at their corporate address. An individual or corporation cannot receive a donation receipt for money that was not donated by them (i.e. an individual cannot be designated to receive the donation receipt for monies raised through a casual day event).
In Kind Donations (i.e. prizes, product), a donation receipt for income tax purposes can be issued for donations of in-kind equal to the fair market value of the property received. To process in kind donations, the Foundation needs a written invoice or other supporting documents that could ascertain the Fair Market Value of the in kind donation.
Donated service is not eligible for tax receipt; this includes special services that necessitate hiring someone for the event (i.e., creative design, photography, and entertainment). The Foundation can however issue a Thank-You letter to acknowledge the donated service.
Goods not eligible for a donation receipt included purchase of items such as raffle or lottery tickets, admission tickets, and golf green fees.
In compliance with the Canada Revenue Agency, in order for gifts to be eligible for tax receipting in any given calendar year, the Foundation must have received the gift by the last business day of December, or a donation must be postmarked prior to December 31st.
If you require a donation receipt to be issued to participants in your event, we ask that you include the Foundation’s charitable number (118852490RR0001) on all your publicity materials and that you state “tax receipts will be issued for donations of $15 or more, or on request”. After the event, in a timely manner, please provide the Foundation with a list (be sure that the information is legible), of names, full addresses including postal codes, and the amount of gift that each individual is to be receipted.
Corporation or business that agree to sponsor an event will receive an invoice or Thank-You letter from the Foundation that would enable them to claim back the full amount of their sponsorship as an expense. A donation receipt may be issued if only the name of the sponsor is being recognized in all printed materials and media outlets. That is, the sponsor is not receiving logo recognition through promotions of the event pre, during or post event.
For fund raising events such as a dinner, auction and golf tournament, a tax receipt may be issued for the entry fee less the “Advantage” the participant has received. However, the advantage amount can not exceed 80% of the entry fee. In addition, please note that if the prizes received by the donor does not exceed the lesser of 10% of the entry fee or $75, then the prizes received by the donor will not reduce the tax receipt gift amount.
Golf Tournament
The following are various components of “advantage” that must be deducted from the tax receipt amount:
Green fees – this would be the green fee charged to non-members playing on the course. Note that if a member of a club is participating in a golf tournament at his/her own club, and would not have to pay for the round, the green fee does not need to be deducted from his/her entry fee to arrive at the donation amount.
Cart rental – cost of rental is to be deducted from the tax receipt amount.
Meals – cost that would be charged if the meal were purchased separately is to be deducted.
Door prizes/achievement prizes – The total retail value of the prizes, whether they are door prizes or prizes awarded for achievement, must be aggregated and then divided by the number of participants. The amount per participant, if exceed the lesser of 10% of the entry fee or $75, must then be deducted from everyone’s receipt amount.
Hole-in-one Prizes – previously, a separate fee had to be charged for this contest to ensure that the value of the prize, (car/money) would not have to be deducted from the entry fee. CRA (Canada Revenue Agency) has now determined that this can be ignored when calculating the tax receipt amounts.
Auction
If the value of the auction item is ascertainable, and the value is made known to all bidders ahead of time, and if someone bids more than 1.25 times the value, that portion could be considered a gift, eligible for a tax receipt.
Example:
If a corporation donates an exercise machine with a retail value of $2,000, and the value is made known to all bidders prior to the bidding, a successful bid in excess of $2,500 would be eligible for a partial tax receipt. This is due to the fact that the donor received an “advantage” that was less than 80% of the amount donated and it is 1.25 times the value.
If the successful bid was $3,000, for the $2,000 exercise machine, then $1,000 would be issued as a donation receipt. This is under the assumption that the bidder knew ahead of time that he was only getting a $2,000 product, so the bidder’s intention was to donate $1,000 extra to the charity.
Consequently, it is important that the value is communicated ahead of time if you wish to issue donation receipts. (However, this could limit the bidding.)
Dinner
If an event is held at restaurant, the price the restaurant would charge for their regular customers would be the “advantage”.
Example:
Cost of the ticket to the dinner is $250, with the Fair Market Value of the meal being $100
The event includes a t-shirt and door prize, total value per donor is calculated as follows:
Gift received by every attendee - $7 t-shirt
Door prize - $4,000 TV
Number of attendees – 400
Since $17 is less than 10% of the gift amount ($250), and less than $75; the t-shirt and the door prize are excluded from the advantage.
The “advantage” received by the attendee is determined to be $100, that is, $250 less $100 for the meal.
The donation receipt will be $150.
Dinner with a celebrity, or a round of golf with a pro, will not result in a tax receipt, no matter how much is paid, due to the inability to assess the value of the “advantage”