Is Your Donation Going to a Registered Charity? 

By Randall Orser | Personal Income Tax

It’s always good to give, and charity is one way you can give to help others, and at the same time get a credit on your taxes. In 2010, 84% of Canadians over 15 donated to charity, for an average of $446/donor, or $10.6 Billion. However, is that charity registered with the Canada Revenue Agency (CRA)? Any organization that wishes to have donors get a tax credit must register with CRA. You may be giving to a US Charity in US dollars, however, it may still be registered with CRA.

That raises the question, how do you know if your charity is registered with CRA?

What is the difference between a registered charity and a non-profit organization?

This is where some donors get confused as you may be giving to a non-profit rather than a registered charity. Although registered charities and non-profit organizations (NPOs) both operate on a non-profit basis, they are not the same. This explains the differences between the two.

Registered charities

Registered charities are charitable organizations, public foundations, or private foundations that are created and resident in Canada. They must use their resources for charitable activities and have charitable purposes that fall into one or more of the following categories:

  • the relief of poverty
  • the advancement of education
  • the advancement of religion
  • other purposes that benefit the community

Examples of registered charities

Here are some examples of registered charities under each of the four categories:

  • relief of poverty (food banks, soup kitchens, and low-cost housing units)
  • advancement of education (colleges, universities, and research institutes)
  • advancement of religion (places of worship and missionary organizations)
  • purposes beneficial to the community (animal shelters, libraries, and volunteer fire departments)

Non-profit organizations

Non-profit organizations are associations, clubs, or societies that are not charities and that are organized and operated exclusively for social welfare, civic improvement, pleasure, recreation, or any other purpose except profit.

Examples of non-profit organizations

Here are a few types of non-profit organizations and examples of each:

  • social, recreational, or hobby groups (bridge clubs, curling clubs, and golf clubs)
  • certain amateur sports organizations (hockey associations, baseball leagues, and soccer leagues)
  • certain festival organizations (parades and seasonal celebrations)

If you wish to find out more about the differences between registered charities and non-profit organizations, go here.

List of charities and other qualified donees

Only qualified donees, including Canadian registered charities can issue official donation receipts for gifts they receive from individuals and corporations. Find a charity or other qualified donee, their current status and any available public information.

  • Charities
    (Charities Listings) Confirm registered status; review contact information and information filed on annual returns.
  • Municipalities
    Municipalities currently registered, revoked or terminated.

How do I Check if the Charity I’m Donating to is Registered?

There are two ways to confirm if a charity is registered with CRA:

· You can also call the Charities Directorate at 1-800-267-2384.

· You can ask the charity for its registration number and confirm its status in the List of charities.

Here’s Some More Information on Donating

Does a charity have to give a receipt when it receives a donation?

No. But the Canada Revenue Agency (CRA) advises charities to tell potential donors when they will or will not give a receipt. For example, a charity may decide to give receipts only for donations over $10.

Can a charity return a donation?

In most cases, no. Once the donation is made, the charity has to use the donation to carry out its charitable programs. But there are exceptions. For more information, go to Returning a gift to a donor.

Can a charity lend its registration number to another organization so it can give receipts?

No. A charity should never lend its registration number to another organization. A charity is responsible for all receipts issued under its name and number and must show these donations on its annual return. A charity that lends its registration number could lose its charitable registration.

Does a charity have to send copies of receipts to the CRA?

No. But charities have to keep a copy of all receipts they issue for at least two years from the end of the calendar year the donations were made in.

Whose name should a charity put on the receipt?

A receipt can be issued only to the true donor of the gift. For example, if a corporation donates money that was collected from its employees, and there is a written declaration to prove this, the charity can issue a receipt in each donor’s name. For more information, see Policy Commentary CPC-010.

Can a charity correct or replace a receipt?

Yes. A charity can give you a replacement receipt. For more information, go to Correcting or replacing official donation receipts.

The charity you made a donation to is no longer registered. Can you still use your receipt to claim a tax credit?

Yes. If the organization was registered when you made your donation, you can still use your receipt to claim a tax credit.

What if you get something in return for your donation?

When a charity gives you something of value in return for your donation, it is considered an advantage. The charity has to subtract the value of the advantage from the amount of your donation to figure out the eligible amount to put on your receipt.

Is it safe to donate online?

A charity that asks for donations online should be responsible for protecting your information. Read the charity’s privacy policy before making a donation. Make donations only if the webpages are secure. If you are not sure about donating online, contact the charity and ask about other ways to donate.

You’ve been invited to participate in a donation program that will make a profit for you. Is it safe to participate?

There are serious risks associated with this type of program. To learn more, go to Donation tax shelter schemes.

Donating not only helps your fellow man, but gives you a tax credit. I will say this, giving less then $200 per year really doesn’t do much for your tax credit, and depending on your income, $1000 or more is better.

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