CHARITABLE DONATIONS

Gifts to registered charities and other qualified donees earn one of the most generous credits in the tax system. The credit is calculated on Schedule 9 and claimed on line 34900.

LIMITS AND CARRY-FORWARD

• Claims are generally limited to 75 percent of net income, plus 25 percent of taxable capital gains from gifts of capital property and certain recapture.

• In the year of death and the year before, the limit is 100 percent of net income.

• Unused donations can be carried forward five years (ten for ecologically sensitive land).

• Because the rate jumps after $200, combining donations into one year, or claiming both spouses' donations on one return, increases the credit.

QUALIFIED DONEES

Registered Canadian charities, registered Canadian amateur athletic associations, registered journalism organisations, municipalities and public bodies, the United Nations and certain foreign universities and charities. Donations to individuals, crowdfunding campaigns and non-registered organisations do not qualify.

RECEIPTS

An official receipt must show the charity's registration number, the eligible amount, the date, and the donor's name. Amounts shown in box 46 of the T4 for payroll donations also qualify.

GIFTS OF SECURITIES AND PROPERTY

• Donating publicly traded securities directly (rather than selling them first) eliminates the capital gain entirely while the donor still gets a receipt for full market value.

• Gifts in kind (art, equipment) receive a receipt for fair market value, and any gain is taxable unless it is exempt (such as certified cultural property).

POLITICAL CONTRIBUTIONS (LINE 41000)

Separate from charitable donations, contributions to registered federal political parties earn a credit of 75 percent on the first $400, 50 percent on the next $350, and 33.33 percent on the next $525, to a maximum credit of $650.