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Things I learned about investing in charities in Canada

30 Dec 2016

It takes some time to figure out how to make the best use of the time and money invested in charity. Here are a few (Canada-specific) things I learned.

said to be Banksy, but can't confirm

They were written in good faith, but as usual, I must emphasize: I’m not a lawyer and can’t guarantee the accuracy or currency. You are the only one responsible for anything you do with this information. Corrections, comments, and constructive criticism are welcome.

Useful tools

  • Canada Helps gets the basic information about a lot of charities and allows you to easily filter those that align with your goals and beliefs. It can also act as an intermediate between you and the one(s) you choose. Of course, the later point isn’t an advantage if you do want to engage with who you are helping - but if you don’t, I assume it will avoid lots of paper waste in mail marketing.

An extra advantage of donating through Canada Helps: you can use PayPal.

  • Charity Intelligence Canada doesn’t seem to list as many charities as the previous one one, but they go deeper on the goals and operational details, which can be an advantage for those who are more deeply concerned with how their donations are spent.

Whichever you choose, check the information there against the charity’s website (it usually contains details on all the things written in this post and several specific to their work). It is also useful to Google a bit and see what people are saying.

Overall, approach it in the same way you treat online shopping, and it will be just as rewarding as that (I’d say more rewarding, but that’s me).

Tax deductions

Any time is a good time for a donation, but the winter comes with additional hardships to almost anyone already in a vulnerability situation. It also signals the approach of December 31 - the last day for which a donation will be deductible in the upcoming year’s tax reports.

I fill my own tax reports (using TurboTax, but there are lots of other good options) and haven’t ever had a problem with claiming deductions, so you should not either. A few tips:

  • Keep the receipts, just like you (should) do with medical and the like. If you do it online, they will often send you a PDF, or sometimes a regular mail. It may only arrive in February (but they usually notify you so as soon as you donate). I’m not sure if an email from them counts as a receipt, but save it as a PDF until you get something else.
  • You can only deduct contributions for charities registered in Canada (hint: it’s ok if it’s an international charity with a registered local branch).
  • Even if you don’t believe you’ll pay enough taxes to actually use the deduction, it seems they carry forward for five years (and in some cases, for ten years). I have never done it, but the government (CRA) says so.