CRA strips charities of tax credit status

Clients donating money to foreign charities may not be eligible for tax credits any more, reports the Globe and Mail.

Read: Protect philanthropic clients

CRA’s list of non-Canadian organizations from which donors can receive a tax credit currently has no organizations on it. In prior years, CRA treated donations to the handful of foreign charities on the list the same as ones to domestic organizations.

The change stems from a rule introduced in the 2012 budget that came into effect last year, says the Globe. Under the new system, a charity must apply to be recognized by CRA after it has received a donation. Only organizations that engage in humanitarian aid, disaster relief or activities in the Canadian national interest, will be approved. With the old system, charities were pre-approved. CRA says a number of organizations are in the process of applying for approval under the new rules.

Read more here.

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The staff of Advisor.ca have been covering news for financial advisors since 1998.