3.Clarification on Charitable Gifts Returned to Donors
•The Budget clarifies the effect of a
charity returning a donation with respect
to the Income Tax Act
•CRA will be able to reassess a taxpayer
outside the normal reassessment period and
disallow a taxpayer’s claim for a credit or
deduction when gifted property is returned to
a donor
•If a charity has issued an official
donation receipt for donation and
subsequently returns the gift to the donor, if the value of the returned property is greater than $50, the charity must issue a revised donation receipt and file a copy with CRA
•Effective for gifts returned on or after March 22, 2011
•Budget does not address the issue of whether or not a gift
can be returned to the donor at law
•Legal
advice should be sought in this regard
•