1. personal donation:
If you or your spouse or common-law partner made a gift of money or other property to certain institutions, you may be able to claim a federal and provincial or territorial non-refundable tax credit when you file your return. Generally, you can claim all or part of this amount, up to the limit of 75% of your net income.
The First-time donor’s super credit (FDSC) supplements the value of the charitable donations tax credit (CDTC) by 25% on donations made after March 20, 2013, by a first-time donor.
For the purpose of the FDSC, you will be considered a first-time donor if neither you nor your spouse or common-law partner (if you have one) have claimed and been allowed a charitable donations tax credit for any year after 2007.
The FDSC applies to a gift of money made after March 20, 2013, up to a maximum of $1,000, in respect of only one taxation year from 2013 to 2017.
If you have a spouse or common-law partner, you can share the claim for the FDSC, but the total combined donations claimed cannot be more than $1,000.
You do not have to claim all of the donations you made this year on your current year return. It may be more beneficial to carry them forward and claim them on your return for any of the next five years.
2. company’s donation:
Whether you are filing personal Canadian income tax or corporate income tax, the rule for charitable donation deductions is basically the same.
As a sole proprietorship or partnership filing a T1 income tax return, you can claim on line 340 charitable deductions and gifts of up to 75 percent of your net income (line 236).
The maximum amount of charitable donations that a Canadian controlled corporation filing a T2 income tax return can claim is the same; 75 percent of its net income (line 300).
You cannot claim charitable donations to create or increase a loss but unused charitable donations can be carried forward and used in any of the five following tax years.
Should business owners donate through their corporations?
NO,It’s not always best to donate personally. but for most time…yes it is. for small business owners, if you donate $10,000 through company, you save tax around $1500; but from personal donation, you will save around $2800. ( rough amount).