2020 Tax Credits rules for Donations
- You can claim tax credits for the amount of your donations, provided they do not exceed 75% of your net income for the year.
- You must determine the amount of donations for which you would like to receive a refund. For any year, you can include:
- donations made before December 31st of the year;
- all donations that have not been claimed and were made within the last five years;
- all donations that have not been claimed by your spouse in the year or within the last five years.
You therefore have 5 years to spread out your donation, depending on what is most advantageous for you.
Note that the organization receiving the donation cannot spread the amount received; it must issue a single receipt in the year it receives the donation and for the total amount of the donation.
Tax credit calculation for charitable donations
There are 2 tax credit rates for the federal government and 2 for the provinces. Any donation over $200 entitles you to a higher rate.
2020 Tax Credit Rates Table
|Province / Country||Credit Rate
(– than $200)
(+ than $200)
Example of credit calculation:
A Quebec resident donated $10,000 in 2020:
- The federal tax credit rates for charitable donations are 15% on the first $200 and 29% on the remaining $9,800. His federal tax credit is therefore:
(15 % x $200) + (29 % x $9,800) = $2,872.
- The provincial charitable tax credit rates for Quebec for the year 2020 is 20% on the first $200 and 24% on the remaining $9,800. Its provincial tax credit is therefore:
(20 % x $200) + (24 % x $9,800) = $2,392.
- Its combined charitable donation tax credit is:
($2,392 + $2,872) = $5,264.
This credit is a non-refundable tax credit. As such, it can only be used to reduce outstanding taxes