Canadian Tax Receipting Explained for Americans - KELL Partners
Close this search box.
Close this search box.
kell partners salesforce partner
Close this search box.
canadian tax receipting

Canadian Tax Receipting Explained for Americans

In the United States, a donation receipt is simple. It’s a document detailing the who, what and when of a gift. Often there’s a friendly acknowledgement letter adjoined to the receipt, and sometimes the receipt is very generic. The US has very few restrictions on receipts. In Canada, receipts are like currency. Each receipt is a unique document that must be auditable from the issuing organization and must meet strict requirements.

What’s so hard about Canadian Receipts?

First it is important to note that the CRA (Canadian Revenue Agency) recognizes a difference between a nonprofit organization and a registered charity. They’re not the same thing and have different rules applied. Only registered charities legally can issue tax receipts for donations, But only if they choose to! The registered charity can set a minimum donation amount to qualify for a receipt, or only issue receipts for certain types of gifts, etc.  Should a registered charity decide to issue receipts there are some key requirements that must be met depending on the type of gift.

Here’s an example of requirements for a cash gift. The receipt must:

  • Include a statement that it is an official receipt for income tax purposes
  • Include the name and address of the charity as on file with the Canada Revenue Agency (CRA)
  • Contain a unique serial number
  • Provide the registration number issued by the CRA (similar to the EIN from the IRS)
  • Include the location where the receipt was issued (city, town, municipality)
  • State the date or year the gift was received; as well as, the date the receipt was issued
  • Include the full name, middle initial, and address of the donor
  • Specify the amount of the gift, and also specify the amount and description of any advantage received by the donor
  • Show the eligible amount of the gift
  • Include the signature of an individual authorized by the charity to acknowledge gifts
  • Provide the name and website address of the CRA

But that can be accomplished with a simple merge, so what’s the big deal?

Notice above all receipts must have a unique serial number? If an error is made on a receipt or a donor lost their original receipt any replacement receipts must have their own unique serial number and the replacement receipt must be linked to the original receipt.  If a registered charity is not in compliance with all the CRA regulations for issuing tax receipts they can face fines and potentially have their charitable status revoked.

Don’t forget that in Quebec the official language is French, so there’s also that.

Whether the organization is based on Quebec or another provence, they must be able to issue receipts in English and Canadian-French.

Managing these requirements efficiently is where the KELL SmartPack for Canadian Receipting with Salesforce becomes a must-have application.

KELL has applied our experience from working with Canadian charities to develop a managed package for Canadian organizations to bring efficiency and compliance to this process of receipting. To learn more and watch a brief demonstration, visit this page.