The Department of Finance released draft legislation on Thursday for the previously announced deadline extension for charitable donations that doesn’t include in-kind donations of securities.
In December, Finance extended the deadline for making charitable donations for the 2024 tax year to Feb. 28, 2025, given the disruption the Canada Post strike had on charities’ fundraising campaigns. The deadline had been Dec. 31, 2024, to receive a tax receipt for 2024.
The draft legislation confirms that the donation can be in cash or “transferred by way of cheque, credit card, money order or electronic payment.” The gift can’t be made through a payroll deduction or by an individual’s will, if the individual died after 2024.
“I wasn’t surprised when I saw it didn’t include donations in kind,” said John Oakey, CPA Canada’s vice-president of taxation, in an interview. The draft legislation is similar to when the donation deadline was extended after the December 2004 tsunami in Southeast Asia, he said.
Overall, “this is a fairly routine announcement,” Oakey said of Thursday’s draft legislation. “It’s very specific with what [Finance was] trying to accomplish [and] consistent with what they’ve done in the past.”
He added he was surprised Finance took so long — about three and a half weeks — to provide the clarification. (The proposed legislation is very short.)
Any donations made up to Feb. 28, 2025, and not claimed on 2024 personal income returns can still be claimed on 2025 returns or carried forward, a CRA release said.
To take advantage of the extended deadline, graduated rate estates (GREs) and corporations must have taxation years that ended after Nov. 14, 2024, and before Jan. 1, 2025. That’s because the postal strike began on Nov. 15, Oakey said.
GREs and corporations that don’t deduct donations on their returns can deduct the donations on their 2025 returns or carry the amounts forward.
In a release accompanying the draft legislation, the government added to recent tax-filing uncertainty.
“To help provide certainty as we head into tax season, the Canada Revenue Agency (CRA) is confirming that it will proceed with administering the 2024 deadline extension for charitable donations,” a CRA release said. “The CRA is administering this proposed legislation, consistent with its long-standing practice.”
Oakey said the reference to the agency’s “long-standing practice” generated confusion, given the extended deadline for donations isn’t in a notice of ways and means motion, as are the proposed capital gains changes.
Regarding the capital gains proposals, Finance previously stated, “Parliamentary convention dictates that taxation proposals are effective as soon as the government tables a notice of ways and means motion; this approach provides consistency and fairness in the treatment of all taxpayers.”
Oakey said, “There’s still a lot of confusion out there on what is ultimately going to be administered and what’s not ultimately going to be administered.”
Other outstanding tax provisions are in announcements just like the one for the extended deadline for donations, he said — that is, in proposed legislation. Taxpayers have no bright line to point to so they can understand how tax changes will be administered, Oakey said.
Still, the CRA wouldn’t administer a tax measure without Finance providing draft legislation, which is “one consistency,” Oakey said.
Henry Korenblum, president of Korenblum Wealth Inc. in Toronto, said the draft legislation was a “positive” step. But “you can’t advise your clients with 100% certainty this will get passed.”
Finance said it isn’t soliciting feedback on the draft legislation and “the government will introduce the legislation in Parliament effecting these changes in due course.”