You can claim a federal and provincial non-refundable tax credit on your tax return when you or your spouse or common-law partner gives money or other property to a registered charity or other qualifying organization.
How the tax credit works
In most cases, the amount you can claim is the amount shown on your charitable donation receipt. The maximum donation amount you can claim is 75% of your net income.
Up to and including 2017, you get:
- a 15% federal tax credit for the first $200 of charitable donations,
- a 29% federal tax credit for amounts over $200, and
- a provincial tax credit.
Beginning in 2016, additional credits are available for donors with taxable income in the highest tax bracket. For example, if you have $215,000 of taxable income and you make a charitable donation of $20,000 in 2016, your federal donation tax credit would be $6,372 ($30 + $4,950 + $1,392), calculated as follows:
- $30 ($200 x 15%)
- $4,950 [($215,000 – $200,000) x 33%]
- $1,392 [($20,000 – $200 – $15,000) x 29%]
You don’t have to claim all the donations you made this year on your current year’s return. You can carry them forward and claim them on your return for any of the next 5 years. However, the changes described above are only for donations made after 2015. Those made before 2016 but carried forward and claimed in 2016 or future years won’t be eligible for the additional credit for those in the highest income bracket.
Only registered charities can issue official receipts for income tax purposes. Check the CRA Charities Listings to find out if a charity is registered.
You can combine your receipts with your spouse and have only one person claim the entire charitable donations amount in order to maximize the amount subject to the higher tax credit rate.
If you file a paper return, submit your receipts. If you file electronically, keep your receipts as support for your claim. Learn more about charitable donations.
The maximum donation amount you can claim is 75% of your net income.
Key point
Only registered charities can issue official receipts for income tax purposes. Check the CRA Charities Listings to find out if a charity is registered.
