Many not-for-profit organizations are having to rely more heavily than ever before on donations as a key source of revenue. Organizations are becoming more creative in their efforts to both widen their donor bases and ward off competition from other fundraisers. Innovative fundraising ventures such as art auctions, silent auctions, 100 hole golf marathons and other sporting events often involve donations of non-cash items. Rules for issuing receipts are often applied incorrectly and, in some cases, possibilities for donors to receive significant tax benefits are overlooked.
For detailed and clearly written information on requirements for issuing chatitable receipts please go to the CRA Website at http://www.cra-arc.gc.ca/tx/chrts/prtng/rcpts/menu-eng.html
We have attached for your information a summary of the information required on donation receipts and a list of some of the infractions that will give rise to financial penalties. A CRA reference has been provided for each item in case you would like more information.
You can view the CRA Guidance on Fundraising documents in English at: http://www.cra-arc.gc.ca/chrts-gvng/chrts/plcy/cps/cps-028-eng.html and in French at: http://www.arc.gc.ca/chrts-gvng/chrts/plcy/cps/cps-028-fra.html. While the guidelines are not “law”, they do give very clear indication of the direction CRA is following (May 2010). The following article is still relevant for those organziations holding charitable auctions. In the summer of 1997 Revenue [...]
Many not-for-profit organizations raise funds from individual and corporate sponsors to augment grant and fee revenue. Before undertaking a fundraising venture the Board of Directors should identify the objectives of the organization and how they relate to fundraising. Once the objectives have been clearly identified then the volunteers and staff can develop and implement a fundraising plan to meet them