Year End Giving Benefits SAIF & You!
Canada has a pretty awesome tax credit system for donors to charities. By donating before year end, you can benefit at tax time while supporting the causes you care most about.
The Charitable Donations Tax Credit can be up to 33% of the amount you donated at the federal level. In Alberta, your Charitable Donations Tax Credit can be up to 21%. Combined, that's a little over 50% depending on your income and the size of your gift. Here's a simple online calculator to help you estimate what your gifting this year could net you in tax credits. There are several rules that determine whether you qualify.
Who qualifies for the Donation tax credit?
These tax credits apply to gifts made to a registered charitable organization (under Canada Revenue Agency - CRA). Hint: SAIF is a registered charitable organization :) Your donation can be money, or it can be anything else of value such as property, stocks, gift cards, art pieces, etc. as long as you do not receive something in exchange for the donation such as dinner or advertising. If you receive something in exchange for your donation, such as tickets to a show, then the value of what you received must be subtracted from the amount you donated. See CRA for details on eligible gifts.
Be aware of donations schemes. Check the CRA link for tips to avoid fraud before you make the donation.
How does the donation credit affect my taxes?
Donations and gifts are non-refundable tax credits. This means you must claim your other credits first. If that amount brings your tax payable to zero, you won't be able to use your charitable donations to create or increase your tax refund. If you still have tax payable, you will be able to use all or a portion of the donation amount.
Keep in mind that when you donate over $200, you are automatically eligible to carry your donations forward and claim them on your tax return for any of the next five years. This flexibility means that the unclaimed carry forward portion may qualify for a larger tax deduction for you, in the future. You can 'accumulate' donations for a potentially larger tax credit by combining them with a spouse's on a single tax return or you can claim donations from multiple years together in the same year.
Is there a maximum I can claim?
Yes, your total donations can be up to 75% of your net income unless you are a member of perpetual poverty. Members of perpetual poverty can donate their entire earned income and claim it as a deduction on line 25600 of their Income Tax and Benefit Return.
Can I avoid Capital Gains Tax by donating securities?
Yes! Securities are the most efficient way to give charitably. When you donate publicly traded securities (stocks, mutual funds, bonds, etc.) directly to your favourite charity, you can eliminate the capital gains tax as these securities are sold, and still receive a tax receipt for their full market value. Plus, your charity also gets the full value of the securities.
Can I get a copy of my charitable tax receipts?
If you made a donation in a given year, SAIF issues tax receipts, usually via email, within 30 days of when donations are received. If you didn't receive your charitable tax receipt or have misplaced it, just call or email our office and we'd be happy to send you a copy.
If you are able to make a donation this year, you can do so online, in person, or over the phone.
Not everyone can make a monetary donation but many organizations can use the gift of your time as a volunteer as well. We are so grateful to the many people who give of their time, resources, and energy. We couldn't do our work without you.