[xyz-ihs snippet=”Call”]In 2013 the Canada Revenue Agency (CRA) recognized the need for additional support for charities by introducing the First-Time Donor’s Super Credit (FDSC) in the budget. This non-refundable FDSC will help supplement the Charitable Donation Tax Credit (CDTC) for individuals.
I am sure you have noticed the Grand Prize Lotteries advertised on TV, fundraisers seeking donations outside high traffic stores and the general mailing and social media requests – ‘Tis the season for giving. And while some of the giving is in hopes of winning a new home or a flashy car, others purchase and donate with the intention of the good cause they believe in or have been affected by. The general concept is giving to help support the community or international not-for-profit charitable organizations. With cut-backs on all fronts donations is helping keep some of the doors open for the smaller organizations. And it is in response to this that the CRA made this allotment.
For the past number of years the CDTC has been calculated as;
- 15% non-refundable tax credit for the first $200 donated in the tax year, and an additional
- 29% non-refundable tax credit for donations exceeding $200 now
- 25% is in addition to the above calculated cash donation.
Below is an example taken from the CRA website.
An eligible first-time donor claims $500 of charitable donations in 2013. All of the donations are donations of money. The first-time donor’s FDSC and CDTC would be calculated as follows:
|First $200 of charitable donations claimed:||$200 x 15% =||
|Charitable donations claimed in excess of $200:||$300 x 29% =||
|First-Time Donor’s Super Credit:||$500 x 25% =||
|Total FDSC and CDTC:||
Q. Who is considered a qualified donor?
A. If you’ve never claimed a donation tax credit, or haven’t claimed a CDTC after the 2007 taxation year, you could be eligible. If your spouse made a claim after 2007 you are not considered a first-time donor.
Q. What is the total allowable donation?
A. The maximum total donation eligible for the FDSC is $1,000.
Q. When can the credit be used?
A. The FDSC is a temporary credit which can only be used once. It becomes effective with the 2013 taxation year and ends with the 2017 taxation year.
And remember, Keep Your Receipts!
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Until next time,
“We make a living by what we get, but we make a life by what we give.”