Tax Insights: 2014 Federal budget: How it affects you and the charitable and not-for-profit sector

Issue 2014-08

This Tax Insights considers proposals in Canada’s February 11, 2014 federal budget that affect the charitable and not-for-profit sector.

Tax relief for donations of ecologically sensitive land, or easements, covenants and servitudes on that land, is claimable in:

  • the year the donation is made, or
  • any of the following five taxation years of the donor

The donation carry-forward period is extended from five years to ten for such donations made after February 10, 2014.

Donations of certified cultural property are measured at fair market value as determined by the Canadian Cultural Property Export Review Board for the purpose of determining the value of the donation.

The budget introduces a rule limiting the value of a certified cultural property donation to its cost amount to the donor if the property was acquired as part of a tax shelter gifting arrangement.

The proposed restriction applies to donations made after February 10, 2014.

Donations made by a will, and those made by designation under a:

  • registered retirement savings plan
  • registered retirement income fund
  • tax-free savings account, or
  • life insurance policy will no longer be deemed to be made by the individual immediately before the individual’s death.

Charitable donations of gifts made as a consequence of the donor’s death will be deemed to have been made by the individual’s estate at the time the property is transferred to a qualified donee, if the transfer occurs within 36 months after death.