5 Questions to Consider Before Donating Time or Money


That time of year is quickly approaching; when we are inundated more frequently with pleas and requests for donations. While giving in and of itself can be rewarding, there are so many questions that can and should be asked. Is the organization reputable, when will I receive my tax receipt, where does the donation actually go?

Is there a way to know which questions you should be asking and who you should give your time or money to?

Here are the 5 questions I consider before donating my time or money

1. Is it recognized as a registered charitable organization?

The Canada Revenue Agency website (CRA) makes it easy to see not only if the organization is registered, but it also gives the effective date of registration, contact information and general activities.  Through this link you can also make an informal request for additional information, free of charge.  Some of the information you could receive is; a copy of the charity’s governing documents, a list of the charity’s directors/trustees and a copy of the public information from a charity’s annual information return with financial statements.

This can be a great eye-opener as to how much is being spent on advertising, third party fundraisers and general overhead when compared to funds spent on programs and clients.  I also use this link when preparing personal tax returns for clients when I don’t recognize the name of the charity. Buying tickets to a circus to benefit you is a good cause and a fundraiser, but is not recognized as a charitable donation for tax purposes even if you get a receipt.

2. Do I want to give my time or my money?

Over the years I have done both.  From a time perspective I’ve helped on committees with fundraisers and program development, been a board member, visiting volunteer, online and in-house counselor. At the beginning of each year I determine which charities I will donate funds to.  When I get phone calls asking for donations I ask them to send me either documentation, a link or website address.  Based on that information I will decide if I want to include them as a recipient of my donations next year.  And giving your charge card information based on an unsolicited phone call is not smart money management. And you shouldn’t have to make that kind of decision immediately.

3. How does it make me feel? This is just as important to me as any other questions I have regarding donating. Some charities pull on my heart-strings because of the help or education they have supplied to friends, family and associates. There are so many valuable charitable organizations in need of our hard earned money. But unless you’re in the top 1% of the population, you can’t give to all of them.  And it becomes more difficult to keep track of whether you’ve received all your donation receipts at tax time.

So donating to my selected charities each year makes me feel good.  I no longer feel guilty when going through a check-out and the cashier asks me if I would like to make a donation to the charity of the moment. I don’t feel pressured when my neighbour is knocking on my door asking for money. I feel educated and in control.

4. Do I donate locally or nationally?

I do both. The national charities I’ve chosen are based on support and research, as it relates to the impact they’ve had on family members.   Locally I’ve been involved with Doane House Hospice for over 20 years.  And in the past year I’ve been involved with a relatively new organization called 100 Women Who Care.  We vote on which local charitable organization will receive our financial support each quarter. This organization has a worldwide reach but is established to help organizations locally.  I’ve learned so much about local organizations that I didn’t even know existed until I became a member. And I feel like I’m really helping those in the community.

5. What impact does donating have on my personal tax return?

The simplified answer is that this is a non-refundable tax credit, which reduces your federal tax liability.  Depending on your income you could receive a credit of 15% for the first $200 donated and 29% credit on an amount greater than $200. It may be more beneficial to accumulate your donations over a number of years to get the 29% credit.  You can carry these forward for 5 years.  If you’re a first time donor there is a Donor’s Super Credit. For more information on eligible donations and gifts see CRA. And to calculate the impact donations could have on your tax return see the Charitable Donation Tax Credit Calculator.

After all I’ve shared, you need to know that I still donate to other organizations.  At this time of year I buy a number of poppies, since I seem to lose them within 24 hours.  And I donate to the charity of choice, in lieu of flowers, for funerals and celebrations of life.

If you’ve had a good or bad experience in donating your time or money I would like you to share that information with me.  It could just be a warning to others or encouraging all of us to give more as we enter the holiday season of giving.

You can  connect with me by clicking the contact tab at the bottom of the screen if you are reading this post on the website or you can leave your information in the form of a comment right here on the site.

Until next time,


Principle Residence Exemption – Reporting of Sale to CRA

Sold Home For Sale Sign in Front of New House

Last week Finance Minister Bill Morneau announced a number of changes in an effort to limit foreign money into Canadian real estate and ensure borrowers can afford the mortgages they want to take on.  One of these includes reporting the sale of residences to the CRA and including any capital gains.

The 3 most discussed changes are:

  • Effective October 17, 2016 there is a stress test used for approving high-ratio mortgages, that will be applied to all new insured mortgages
  • Effective November 30, 2016 new restrictions will be imposed in providing insurance for low-ratio mortgages
  • The launch of consultations regarding lender risk sharing

But I think the 4th item, also effective in 2016, is what everyone selling a home in Canada should be aware of:

  • Previously when selling your principal residence any financial gain was tax-free and it was not necessary to report the income on the sale. Now, the capital gains tax is still waived, but the sale of the primary residence must be reported to the CRA when filing your personal tax return.

You will need to supply to CRA:

  • Date of purchase
  • Proceeds of disposition
  • Description of the property

Why the changes?

  • Ottawa is responding to extensive media reports indicating foreign investors are flipping homes in Canada and falsely claiming the primary residence exemption
  • Ensures families only claim an exemption on one home a year, and the home owners must live in the property
  • Certifies that if an individual was not a resident of Canada in the year they purchased the residence, and they disposed of that property after October 2, 2016, they are not eligible to claim the exemption for that year

This is also a fact and history-gathering move for Ottawa.  Did you sell a cottage during one of the years, and not pay tax on the capital gains, while you were claiming another address as your principle residence? It could be also be a way flagging a possible “lifestyle audit”.

Do you think this change will curtail foreign investment, or homeowners trying to claim more than one property as a personal residence? Or do you have other concerns regarding this change? I’m interested in hearing your thoughts.

You can  connect with me by clicking the contact tab at the bottom of the screen if you are reading this post on the website or you can leave your information in the form of a comment right here on the site.

Until next time,


5 Client Surprises this 2013 Canadian Tax Season

bigstock-Tax-Worry-3308866Well the personal tax return season rush is basically over but I will continue preparing tax returns for 2012, and prior years, for the balance of the year. While reflecting on the achievements of our 2012 tax season I’m reminded of the clients surprised by information I shared with them.  Here are 5 significant 2013 Canadian client surprises this season:

1.    RESP Funds Received.  The surprise was that the money was taxable. The good news is that the money is taxed to the student, who usually doesn’t have a lot of income that year and tax payable is minimal, if any.  A T4A slip is received from the investment source and the amount is recorded in Box 42.

Read more

5 Ways to Help the Environment During Tax Return Time

Businessman sinking in heap of documentsIt’s that time of year again when long hours and endless amounts of paperwork are compacted into a very hectic six week period – Tax Season.  I’m trying to do my part for the environment by reducing the number of trees that give up their lives during tax season.  Instead of printing every schedule and report for those clients whose tax returns I e-file, I’m encouraging them to review their returns I’ve emailed to them, sent in a PDF format.  Here are 5 ways this helps the client and the environment.

1.  It gives the client the option to print all or part of the return or review it on their screen.  An increasing number of my clients are concerned about the unnecessary resources being used by offices.  Saving their tax files in an electronic format saves physical storage space and can be more secure.

Read more

5 Reasons to Outsource Your Bookkeeping

Hello and welcome to my Blog!  There are so many good reasons to outsource your bookkeeping.  Many business owners find looking after the financial side of their business to be a tedious and worrisome task.  Here are 5 great reasons to consider outsourcing your bookkeeping.

1)     Work ‘on’’your business not ‘in’ it.

It is extremely valuable for you to understand your financial statements, but you don’t need to be the one spending the time entering and reconciling.  That isn’t why you started your business, and it isn’t making you money. Focus on what you do best.

Read more