As a registered charity, Sault Area Hospital Foundation must adhere to the Canada Revenue Agency (CRA) Income Tax Act when issuing charitable tax receipts.
Detailed guidelines can be found CRA’s Charities and Giving Website.
The Foundation will make every effort to advise potential donors of any circumstance in which a receipt will not be issued.
Receipts for eligible gifts received online will be automatically issued to the return email address of the donor at the time the gift is made. There is no minimum.
Receipts will be issued annually for other eligible gifts received during the fiscal year in which the cumulative total is $20 or more. For estate gifts or as deemed necessary, a single receipt will be generated within 10 business days of the gift being received.
GIFTS OF CASH
A charitable donation tax receipt will be issued by the Foundation for regular donations of money by an individual or estate. The donor must provide all information that is required by CRA to the Foundation so that a receipt may be issued.
A charitable donation tax receipt will be issued by the Foundation for regular donations of money by a business. The donor must provide all information that is required by CRA to the Foundation so that a receipt may be issued.
As per CRA regulation, the Foundation will not issue a charitable tax receipt to other charities.
GIFTS OF SECURITIES
A charitable tax receipt will be issued for the value of the publicly traded security at closing on the day the gift of securities is received by the Foundation’s Investment firm.
When the Foundation agrees, a charitable tax receipt can be issued for new items donated by individuals which are accompanied by a receipt of purchase from the original supplier or appraisal.
Items purchased within the past three years, the charitable tax receipt amount will be the lesser of the purchase price or fair market value.
Items purchased beyond three years, the charitable tax receipt amount will be based on the fair market value.
Fair market value as defined by CRA is “highest price in dollars that the property would bring in an open and unrestricted market” between a willing buyer and seller who are both informed, prudent and knowledgeable and acting at arm’s length. For items deemed to be valued at $1,000 or more, an independent appraisal is required.
For gifts made and donated by an individual who makes artwork for a hobby, only the value of the inventory used to make the art piece is eligible for a charitable tax receipt.
A charitable donation tax receipt will NOT be issued for any items, including auction items, in which the value of the item is not clearly ascertainable. This includes but is not limited to personal sports paraphernalia and private dinners.
Items from inventory are deemed an expense of the business and therefore there is no benefit to being issued a charitable tax receipt. Under CRA regulations, a business must include in income the fair market value of the donated item which could then be offset by the deduction for the receipted donation of the item to a charity. As a result a charitable tax receipt does not provide any benefit. Rather, a letter of acknowledgement will be provided to the business as documentation of their gift for recording of the gift as an expense.
GIFT OF SERVICES
CRA regulations do not allow for issuing of a charitable tax receipt for services offered or provided. Alternatively, where the Foundation agrees, the individual can invoice the charity for the service and receive payment, at which time the amount of the payment can be donated back the charity. This then fulfill the requirements of a cash donation and can be receipted as such.
Third Party Fundraiser:
A donation submitted by a Coordinator of a Fundraiser in which gifts were collected from other persons with the understanding their gift would be given to charity, can be receipted only to the individuals that made the gift for the amount of their contribution. The Coordinator cannot be receipted for any gifts that were not part of their own direct contribution.
Business sponsorship of an event is generally not eligible for a charitable tax receipt. CRA regulations stipulate that the special recognition associated with the donation is an advantage and as such the value of that advantage is cannot be receipted. In such cases the Foundation will issue a letter of acknowledgement as a receipt for the sponsorship. Such a gift would be considered an advertising expense of the business.
Tickets to Attend:
Each event will be individually assessed to determine the amount from each ticket that is eligible for a charitable tax receipt based on CRA regulations. Where the fair market value of admission to the event as well as the fair market value of any door prizes and/complimentary gifts associated with the event ticket do not surpass 80% of the ticket price, a charitable tax receipt will be issued for the determined eligible amount. The Foundation maintains the right to not issue receipts for tickets whenever deemed in their best interest to do so.
The Foundation cannot issue a charitable tax receipt to the successful bidder of an auction item unless the paid amount exceeds 125% of the retail price or fair market value of the item and the value is clearly displayed and made known to bidders in advance. CRA regulations state that when the amount paid reaches or exceeds this threshold, a charitable tax receipt can be issued for the amount over the retail price or fair market value.