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“From a budgeting perspective, you kind of have to look for the cause and effect you’re going to get and one of the things that we have found with our clients over time is that there tend to be core donations that they make every year. So, we kind of peel the onion away. The core donations may be to your church or religious organization and may be something where someone in your family has been impacted – impacted by disease and you want to memorialize or honour or acknowledge them by giving to a charity for that. So, you want to give that amount every year.” But too many philanthropists are undecided about how much to give. “Every dollar’s important and, from the perspective of a guide, many of these organizations will say a good place to start is one per cent of your income,” Palay says. “I think people would be surprised that they’re very close to giving one percent of their income.” Of course, that percentage could increase as your income increases. And that can affect your tax returns in a positive way.
“If you look at Revenue Canada agency data, it’s surprising that not a huge percentage of people even claim their $200 tax credit,” Palay says. “These people are giving and not realizing that they can deduct it because the first $200 of a donation has a 15 per cent tax credit. Accumulative donations over $200 have a 29 per cent federal tax credit, which translates in Manitoba to a 46 to 50 per cent break if you give over $200 and you’re at the top tax bracket. Then, almost half of your donation is covered by offsetting taxes. So, it can be very tax efficient.” Couples who donate to charity and claim those donations separately are missing out on tax breaks. Instead of each one giving and claiming $100 to $150 a year, they should combine those amounts and just have one partner claim the total amount, Palay advises. “Therefore, anything over $200, they’ll get a better tax (return),” he says. “There’s a tax efficiency to doing these things the right way.” Quadrant Private Wealth advises many of its clients on such matters. “We advise several hundreds of
families, corporations and institutions,” Palay says. “There’s no charge for our advice as long as you’re a client. In order to be a client, you have to be invested in us. So, it’s a value-added service that we provide … Charities are an extremely important part of what we do.”can help by purchasing the equipment.” According to Statistics Canada, Manitoba was the most charitable province in Canada in 2022: Just under one in five tax filers (19.3 percent) declared a donation on their tax form that year, with a median donation of $590. These donations were equal to a value equivalent to nation-leading 1.0 percent of total income. That shows Fowler that philanthropy is alive and well in the community. “When someone makes a charitable donation, my hope is always that it brings the giver joy,” she says. “You do get a tax receipt, but the tax receipt isn’t the most important part of the gift. For most people, it’s the joy that comes from knowing they had an impact on other people’s lives and that they’re making an impact on the present and the future.”
Couples who donate to charity and claim those donations separately are missing out on tax breaks.
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Manitoba
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