Donations Tax Credit
Up to 75% of a taxpayer's net income can be claimed as donations, except in the year of death
or the year preceding death, when 100% of net income can be claimed
as donations.This donations limit also changes when capital
property is donated - see the article regarding
donations of capital property.
Only donations to registered charities and other
qualified donees (see the
CRA definition for a qualified donee) can be claimed as
charitable donations. CRA has a web page,
Charities and Giving, where you can search charities listings
to see if a particular charity is a registered charity.
The tax credit for donations and gifts is in the
form of a
non-refundable tax credit. The tax credit for the first
$200 of donations is at the lowest personal tax rate (except for
Québec, which uses 20%), and the tax credit for the amount over $200
is at the highest tax rate federally, and for all provinces and
territories except Alberta. Alberta has only one tax rate
(10%) for calculating income taxes, but uses 21% as the rate for
donations above $200.
When a taxpayer has a spouse or common law
partner and the combined donations are greater than $200, the
donations for both spouses should be combined and claimed on one tax
return.
Donations need not be claimed in the year they
are paid. They can be carried forward for up to 5 years.
For more information see the CRA publication
P113 Gifts and Income Tax.