Aside from not using charity donations for tax-shelter purposes (see the first article above), you should be aware of the stringent requirements for donation receipts in section 3501 of the Income Tax Regulations.
Receipts may be issued on paper, and mailed or delivered to you; or electronically, and sent by email or web link pickup. Regardless of which form is used, you should check every receipt to make sure it complies with the list below, and ask the charity for a replacement receipt if it does not. Otherwise your donation could be denied when your claims are audited months or years after filing your return.
Based on subsection 3501(1) of the Regulations, every receipt must contain the following to be valid:
- The name and address in Canada of the charity, as recorded with the CRA.4
- The registration number (also known as a “Business Number”) assigned by the CRA to the charity. This takes the form of 9 digits, plus “RR” (for charity registrations), plus four digits for the branch number, most often 0001. Example: 123456789RR0001.
- The serial number of the receipt.
- The place where the receipt was issued.
- Where the donation is of money, the date on which — or the year during which — the donation was received by the charity.
(e.1) Where the donation is of property other than money:
- the day on which the donation was received,
- a brief description of the property, and
- the name and address of the appraiser of the property, if an appraisal was done.
- The date on which the receipt was issued.
- The name and address of the donor including, for an individual, the individual’s first name and initial.
- The amount that is:
- the amount of the donation, if it was money, or
- if the donation is of property other than money, the amount that is the fair market value of the property at the time the donation was made.
- A description of the “advantage”, if any, in respect of the donation and the amount of that “advantage”. This refers to any benefit you may have received in exchange for making the donation. For example, if you paid $500 for a ticket to a fund-raising dinner and the dinner was worth $50, the “advantage” is $50.
- The “eligible amount” of the donation. This is the amount of the donation minus the “advantage” above. In the above example, the “eligible amount” that you can claim for tax purposes would be $450.
- The signature of a responsible individual who has been authorized by the charity to acknowledge donations. (A “facsimile signature” is permitted where all receipt forms are preprinted and serially numbered; the CRA also permits a copy of a signature for electronic receipts, such as those provided by email.)
- The Canada Revenue Agency name and Internet website. While the website is “cra.gc.ca” or “www.cra-arc.gc.ca”, the CRA expects to see “cra.gc.ca/charities” or “www.cra-arc.gc.ca/charities”, or the equivalent in French, on the receipt.
It is good practice to check every receipt against these requirements as you receive it. You might be surprised how often small charities have some detail missing on their receipts. If you draw any missing items to the charity’s attention, you will be helping the charity stay in compliance (and avoid risking revocation of its charity status), as well as helping all other donors ensure they can get their donation credits.