Some time ago, I wrote about proposed subsection 248(40), which would have required charities to make inquiries about the circumstances surrounding a gift where the eligible amount of the gift exceeded $5,000. It appears that Finance might withdraw the proposed subsection.
The Canadian Association of Gift Planners received a letter from Len Farber of the Tax Legislation Division at the Department of Finance stating that “we are prepared to recommend to the Minister of Finance that proposed subsection 248(40) be withdrawnâ€. For more detail, see the CAGP press release.
The press release quotes Mr Farber stating that
As was the case before the proposal of this provision, charities will still be responsible to seek relevant information from donors where the need for such information is apparent to them in the particular circumstances.
Mr Farber is referring to the obligation charities have to issue receipts showing the appropriate eligible amount. This obligation existed before Finance proposed 248(40), and the obligation will continue to exist even if the subsection is withdrawn. Accordingly, charities who went to the trouble of designing due diligence questionnaires in the expectation that they would be needed to comply with proposed 248(40) may want to keep them handy: the questionnaires might be useful where a charity suspects that the eligible amount of a gift ought to be reduced because of the circumstances surrounding the gift.
