MARCH 2004 DONATION RECEIPT REQUIREMENTS

The federal budget introduced in the spring of 2004 included a number of proposed legislative changes that will have an effect on every charity issuing income tax receipts in Canada.  The principal changes include:

  • The requirement to include CRA's name and Website address on every donation receipts issued after December 31, 2004;

  • The introduction of numerous financial penalties for late filing of information returns, issuing incomplete donation receipts and other matters;

  • Changes to the disbursement quota rules that could have an impact on charitable organizations receiving significant amounts from other registered charitable organizations.

We have attached for your information a summary of the information required on donation receipts and a list of some of the infractions that will give rise to financial penalties.  A CRA reference has been provided for each item in case you would like more information. 

CANADA REVENUE AGENCY DONATION RECEIPT REQUIREMENTS

(effective March 2004)

Cash donations

The following information must be included on every receipt issued for a cash donation:

 

CRA Requirement

 

 

CRA Reference

 

Date effective

 

Yes/No

Statement that "It is an official receipt for income tax purposes"

Guideline RC4108

Now

 

Charities business number and name and address as registered with CRA Charities Division

Guideline RC4108

Now

 

Serial number of the receipt

Guideline RC4108

Now

 

Name and Website address of CRA

March  2004 budget

January 1, 2005

 

Place the receipt was issued

Guideline RC4108

Now

 

Day on which or year in which donation was issued

Guideline RC4108

Now

 

Day on which the charity issued the donation receipt

Guideline RC4108

Now

 

Name and address of donor (must include first name and initial of individual donors)

Guideline RC4108

Now

 

Amount of the donation

Guideline RC4108

Now

 

Signature of the individual authorized by charity to issue receipts

Guideline RC4108

Now

 

For all replacement receipts, a statement that "This receipt cancels and replaces receipt # XXXXX"

Guideline RC4108

Now

 

 

Gift‑in‑kind donations 

The following information, in addition to that noted above for cash donations, must be included on every receipt issued for a gift‑in‑kind donation:

 

CRA Requirement

 

 

CRA Reference

 

Date effective

 

Yes/No

The day on which the charity received the donation

Guideline RC4108

Now

 

A brief description of the property donated

Guideline RC4108

Now

 

The name and address of the appraiser of the property if an appraisal was completed

Guideline RC4108

Now

 

The amount of the fair market value of the property at the time the gift was made

Guideline RC4108

Now

 

Notes on issuing charitable donation receipts:

  • Receipts can only be issued for gifts of property.  A donation receipt cannot be issued for a gift of services as services are not property. Guideline RC4108

  • The fair market value of all non‑cash gifts must be determined (IT 297 R2 Para 6).  We recommend that a charity obtain an independent appraisal for all gift‑in‑kind donations in excess of $1,000.

  • Charities must retain a paper copy of every receipt issued, or be able to print a copy of the receipt without inputting any new data required on the receipt. Guideline RC4108

  • Copies of lost donation receipts must be marked "Cancelled".  All copies of a spoiled donation receipt must be retained by the charity and marked "Cancelled".  Guideline RC4108

  • The annual information return (T3010A) must be filed within six months of the year end.

Fines and penalties included in the March 2004 budget  and effective January 1, 2005 are as follows:

 

Infraction

 

 

Penalty ‑ first time

 

 

Penalty ‑ repeat infraction

 

Late filing of T3010A

$500

$500

Issuing of receipts with incomplete information

5% penalty on the eligible amount stated on the receipt

10% penalty on the eligible amount stated on the receipt

Issuing receipts that, in total, do not exceed $20,000 if there is no gift or if the receipt contains false information

125% tax on the eligible amount stated on the receipt

125% tax on the eligible amount stated on the receipt

Issuing receipts that, in total exceed $20,000 if there is no gift or if the receipt contains false information

Suspension of tax receipting privileges and a 125% tax on the eligible amount stated on the receipt

Suspension of tax receipting privileges and a 125% tax on the eligible amount stated on the receipt