Tax benefits

TAX BENEFITS

NEW FEDERAL FIRST TIME DONORS SUPER TAX CREDIT

A recent federal budget introduced a temporary super credit for first‐time donors, for monetary donations not exceeding $1,000. This new incentive measure increases the effective rate on the current federal income tax  credit for charitable donations by 25%. As a result, a first-time donor will be allowed a 40% federal credit for donations of $200 or less, and a 54% federal credit for the portion of donations over $200 but not exceeding $1,000.

To calculate federal tax credits, use this on-line calculator.

For more information on the temporary super credit, visit the Canada Revenue Agency.

NEW ADDITIONAL PROVINCIAL TAX CREDIT OF 25% FOR AN INITIAL LARGE CULTURAL DONATION

An additional tax credit, of up to $6,250, will be granted to individuals who make an initial cultural donation of at least $5,000 before January 1st, 2018. More specifically, an individual may receive, for a given taxation year, in addition to the tax credit for donations currently allowed by the tax system, a non-refundable tax credit equal to 25% of the eligible amount of a large donation made in the year to a recognized cultural organization. For the purposes of the tax credit, a monetary donation of up to $25,000 made in a given taxation year, in one or more instalments, will be considered a large donation if the eligible amount of such donation is at least $5,000.

NEW PROVINCIAL TAX CREDIT FOR CULTURAL PATRONAGE BY INDIVIDUALS (DONATIONS OF $250,000 OR MORE)

Instead of the tax credit for donations and the new additional tax credit for an initial large cultural donation, these individuals may claim a non-refundable tax credit calculated at a rate of 30% of the substantial donations of money they have made. This tax credit will essentially target individuals who give a cultural organization a sum of money of at least $250,000 over a period of no more than ten years, at the rate of a donation of an eligible amount of at least $25,000 in each of the years covered by the pledge, to meet a specific need for capital and to ensure the organization’s long-term funding.

For more information: Ministère des finances bulletin (July 3, 2013).