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Charitable giving by Canadians
6-18-2014
Every year, millions of people donate money to charitable and non-profit organizations. By contributing financially to organizations and groups that support causes dear to their heart, donors want to contribute to the well-being of their fellow citizens or advance principles and values that they believe in. In recognition of the difference these donations can make in the community, governments provide income tax credits to encourage giving by taxpayers or match the amount donated by individuals in certain cases.
People who are more religiously active are more inclined to donate and, on average, they make larger donations. In 2010, 93% of them had given money to one or more charitable or non-profit organizations, and their average annual donation was $1,004. In comparison, 83% of donors who attended less often or not at all had donated, and their average annual donation was $313.
Studies have shown that people with strong religious convictions also often have stronger pro-social and altruistic values, which motivate them to give more of their time and money to others. Also, because they are integrated into networks of congregational members, they would appear to be solicited more often and to feel more social pressure to give and to meet the group’s standards. This being said, there are many reasons that might explain the gap between religious people who practice regularly and those who are less active, and these reasons may have different effects depending on religious affiliation.
Gifts to registered charities and other qualified donees
You can claim a tax credit based on the eligible amount of your gift to a qualified donee. Qualified donees are:
1. registered charities;
2. registered Canadian amateur athletic associations;
3. registered national arts service organizations;
4. listed housing corporations in Canada set up only to provide low-cost housing for the aged;
5. listed municipalities in Canada;
6. listed municipal or public bodies performing a function of government in Canada;
7. the United Nations and its agencies;
8. universities outside Canada listed in Schedule VIII of the Income Tax Regulations that
ordinarily include students from Canada;
9. the Government of Canada, a province, or a territory; and
10. listed foreign charitable organizations to which Her Majesty in Right of Canada has made a gift and have been registered.
To further assist donors in determining which organizations may issue official donation receipts, qualified donees must appear on the publicly available list that CRA maintain. The only exceptions are the United Nations and its agencies, the Government of Canada, or a province or territory. Generally, you can claim part or all of the eligible amount of your gifts, up to the limit of 75% of your net income for the year.
Footnotes: Footnotes: This column is presented as a general source of information only and is not intended as a solicitation for business. It is always recommended that you consult a qualified tax professional before embarking on any of the suggestions outlined above. Mohammed Yasin, CGA, is the principal of M. Yasin & Co. Inc., Certified General Accountants and has offices in Vancouver & Surrey,B.C. He is also A Member of Muslim Business Council of B.C. For more information on this topic or any other taxation matter
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