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Donation Receipts and Eligible Programs FAQ’s

Donation Receipts and Eligible Programs FAQ’s 

Q - Who is Equine Canada?

A - Equine Canada is the national governing body responsible for the development and promotion of equestrian pursuits in Canada. We are a federally incorporated company who is also registered with the Canada Revenue Agency (CRA) as a Registered Canadian Amateur Athletic Association (RCAAA), business registration number 12286 3210 RR 0001.

Q - Can we solicit donations on behalf of Equine Canada?

A - Yes, Equine Canada is able to accept donations or “gifts” form donors as long as it meets the basic definition whereby the gift is a voluntary transfer of property without expectation of return or consideration. The Canada Revenue Agency (CRA) states that "accepting a gift or donation which was expressly or impliedly conditional upon the RCAAA making a gift or donation to another person, club, society or association is strictly prohibited".  The Income Tax Act also specifically stipulates that CRA may revoke the registration of an RCAAA where it finds otherwise.

Q - Can Equine Canada issue donation receipts?

A - Yes, there are specific tax provisions in the Income Tax Act which are intended to benefit RCAAA’s such as Equine Canada by allowing us to issue official donation receipts for income tax purposes thereby providing tax incentives to donors.
 
Q - What other types of programs or events could Equine Canada issue donation receipts for?

A- Equine Canada currently issues donation receipts for:

1. Individuals and Corporations,
2. Fund Raising events and galas,
3. Horse Maintenance program and,
4. Horse Donation Program .

Q - Can I get more information concerning eligible donations or income tax receipts?

A - Yes. You can always contact the Canada Revenue Agency (CRA) at:

Charities Directorate,
Canada Revenue Agency,
Ottawa ON  K1A 0L5,
1-800-267-2384
website at www.cra-arc.gc.ca/charities

or contact:
Equine Canada
Finance Department 
308 Legget Drive
Ottawa ON  K2K 1Y6
613-287-1515

1. Individuals and Corporations

Q - When can a receipt be issued in a name other than the name on the cheque?

A - Where a registered charity receives a cheque from a corporation and is subsequently asked to issue the official donation receipt in the name of an individual who controls the corporation, the charity must refuse to issue the receipt to the individual. The charity may only issue a receipt to the individual if there is evidence to show that the individual is the true donor, for example, the donation is by way of that individual's personal cheque or by way of the corporation making the donation in the name or on behalf of the individual (for example, a corporation accounts for the donation from a shareholder in the shareholder's account). This guideline also applies to a gift from a partnership in which both spouses are business partners.

Q - Can we solicit donations on behalf of a specific discipline?

A - Yes, these funds will be directed to the disciplines or program of Equine Canada requested by the donor in order to assist with our mandate to develop and promote equestrian pursuits in Canada
.
Q - Who controls the funds on behalf of a specific discipline?

A – Equine Canada will direct the funds to the disciplines or program. These funds will remain within the discipline budget to spend according to the disciplines mandates, goals or objectives for the year. The disciplines will approve the appropriate allocation of expenditures.

Q - Does Equine Canada charge an administration fee to the disciplines?

A - Yes, all donations received by Equine Canada are subject to a 5% administration fee of the donation amount. The remaining 95% is then allocated to the discipline revenues.

Q - Can the donor make the cheque out in the name of the specific discipline?

A - No. All cheques must be made out to Equine Canada as we are issuing the official receipt for income tax purposes.

Q - Can we solicit donations on behalf of a specific athlete?

A - No. This is an area CRA specifically addresses. We are not allowed to be a flow through from donor to athlete. If the donation has specific directions attached to it then it does not meet the basic definition of a gift. As a RCAAA Equine Canada’s mandate is to develop and promote the entire sport rather than selected individuals.

Q - Can we solicit donations on behalf of a group of athletes such as the CET?

A - Yes. The funds would then be allocated to a specific group of athletes associated to a discipline as addressed above.

For more information on individual or corporate donations please contact CRA or the Equine Canada office at the coordinates previously listed.

2. Fund Raising Events and Galas

Q - We are planning to organize a fund raising event for the Canadian athletes can you tell me what type of benefits are available to the potential donors?

A - Equine Canada can issue official donation receipts for income tax purposes for various fund raising events such as a portion of ticket sales, donations, auction items donated etc.

Q – Can we get a donation receipt for the purchase of a ticket to a fund raising event?

A - Yes and No. According to CRA policy, a portion of ticket price may be eligible for a donation  receipt for income tax purposes if the cost of the ticket is more than the perceived value of the event, (including meal, entertainment, etc). The answer would be no if there is no perceived value and the cost of the ticket simply covers the actual costs of the event.

Q - Do we have to charge GST on the price of our ticket?

A- No, if you are issuing a donation receipt for a portion of the ticket price then you do not have to charge GST on the price of the ticket.

Q -  Can we get a donation receipt for items donated to an auction for resale?

A - Yes. Any "property" donated for auction qualifies for an official donation receipt for income tax purposes.

Q - How do we determine the value of an item and the amount of the donation receipt?

A - If the item (property) comes from a source with a set published retail price etc. then that retail price becomes its value; no assessment is needed. Proof of the stated value, such as an invoice or catalogue price should accompany the item when it is donated. A donation receipt will then be issued from Equine Canada to the donor of the item for its stated value.

If someone donates an item that is valued at more than $1,000 and proof can not be stated then an independent appraisal from an expert should be obtained. The value can then be applied to the official donation receipt for income tax purposes.

Q - Does the actual selling price of an auction item reflect the donation receipt amount?

A - No. What we sell that item for (to the buyer) at the auction does not reflect the amount listed on the official donation receipt for income tax purposes (of the donor). They are two separate transactions.

Q - Can we issue donation receipts for gift certificates?

A – Yes, if you follow CRA guidelines. Companies or individuals who donate gift certificates should be treated as follows: Equine Canada should buy the gift certificate and issue a cheque to the donor, who then records a sale transaction in their books. The donor can then issue a cheque back to Equine Canada as a donation and a tax receipt will be issued for the amount of the cheque. The certificate can then be sold at the auction.

Q - Can we issue donation receipts for gifts of service?

A – No and Yes. CRA has determined that donations and contributions of services, that is, of time, skills or efforts, are not considered property, and therefore do not qualify as gifts for purposes of issuing official donation receipts. As such, Equine Canada cannot issue an official donation receipt for services rendered free of charge.

However the answer would change to yes if the donated services follow the process of a gift certificate (as previously listed) whereby Equine Canada pays for the service, the revenue is then recorded into the donors sales or income and then the donor can issue a cheque back to Equine Canada as a donation and a tax receipt will be issued for the amount of the cheque. The certificate of services can then be sold at the auction.

For more information on Fund raising events and galas please contact CRA or the Equine Canada office at the coordinates previously listed.

3. Horse Maintenance Program

Q - How do you qualify for the Horse Maintenance Program?

A - The Horse Maintenance Program is designed to issue an official receipt for income tax purposes corresponding to the out-of-pocket expenses incurred in maintaining a team horse. The top 20 horses qualifying for the program are identified by their respective disciplines on an annual basis.

Q – Does an application or information package exist for the Horse Maintenance Program?

A - Yes, An information package will include:
•    Covering letter to the owner;
•    Horse Maintenance Policy;
•    Guidelines Supplementary to the Horse Maintenance Policy;

•    Sample covering letter for participants of the program; and
•    Form to summarize eligible expenditures.

Q – Who is eligible for a donation receipt under the Horse Maintenance Program?

A - The owner, or the one who paid the actual expenses, is eligible for a donation receipt corresponding to the out-of-pocket expenses incurred in maintaining and competing a team horse.  In accordance with the directive from CRA, eligible expenses will be restricted to out-of-pocket expenses that are required over-and-above the costs of the horse’s ordinary maintenance;  predetermined at $2,000 per horse, will be deducted from the expenses submitted.

Q – Can multiply owners or payers of expenses of the same horse qualify for the Horse Maintenance Program?

A – Yes. If more than one individual incurs expenses on the horse, a donation receipt will be issued to each individual based on the amount each person expended in maintaining the said horse supported by receipts. Donation receipts can only be issued to the individual or entity invoiced unless there is sufficient evidence (i.e. a cancelled cheque) that another person paid the invoice.  Donation receipts for syndicated horses will be split amongst the syndicate members unless receipts otherwise support the request.

Q – What type of expenditures are acceptable under the Horse Maintenance Program?

A - Maintenance expenses fall into the following general categories as they relate to the horse:
Board, Farrier, Veterinarian, Horse transport, Show entries, Training, Horse insurance, Other such as: Competition related travel, food and accommodation, Horse passports and license fee, Membership and sport license fees, Minor repairs to equipment.

Q - Does Equine Canada charge an administration fee to applicants selected for the Horse Maintenance program?

A - Yes, all applicants selected by their discipline and Equine Canada are subject to a $300 (plus GST) administration fee.

For more information visit the Horse Maintenance Program section or contact the Equine Canada office at the coordinates previously listed.

4. Horse Donation Program

Q - How do you qualify for the Horse Donation Program?

A –The Horse Donation Program is designed to issue an official receipt for income tax purposes corresponding to the appraised value of a horse donated to Equine Canada. The horse must be able to compete for the team internationally in the year of donation or in the opinion of the team coach or discipline chair, has the potential to compete internationally in the following year.

Q – Does an Information package exist for the Horse Donation Program?

A - Yes, An information package will include:

•    Letter of intent of the owner to freely donate the horse;
•    A deed of gift;
•    Valuation letters from 2 professional horsemen,
•    Statement by qualified Veterinarian,
•    Confirmation of assessment,
•    Letter of Agreement etc.

Q – Who is eligible to use the donated horse?

A – Although the horse will be owned by Equine Canada the horse will be offered to an international caliber competitor.

Q – Who is responsible for the maintenance of the donated horse?

A – The competitor is responsible for the out-of-pocket expenses incurred in maintaining and competing with the donated horse.

Q - Does Equine Canada charge an administration fee to applicants selected for the Horse Donation program?

A - Yes, all applicants selected by Equine Canada for the Horse Donation Program are subject to a $500 (plus GST) administration fee.

For more information visit the Horse Maintenance Program section or contact the Equine Canada office at the coordinates previously listed.