What Constitutes Fundraising?
Fundraising is an activity involving the solicitation of support of cash or in-kind donations from individuals or corporations whether or not a receipt is issued. Solicitations of support are statements or representations made for the purpose of seeking cash or in-kind donations.
The CRA does not consider fundraising as a charitable activity as it does not advance a charitable purpose but does acknowledge that it is a necessity for many charities. CRA expects charities to focus on fulfilling their charitable purposes rather than devoting excessive time or resources to fundraising. It is recommended that while the church may use fundraising only to assist in achieving broader charitable purposes, it may not have fundraising as its main or prevailing purpose.
Amounts Eligible for Receipting Purposes
When engaging in fundraising activities, it will be important to determine the eligible amount of a gift for receipting purposes. The cost of goods or services (advantage received) included in the fee or ticket must be deducted from the total amount given for receipting purposes. If the cost of the advantage is equal to the lesser of $75 or 10% of the total gift, the entire amount may be receipted for tax purposes.
All expenses related to a solicitation of support are to be reported as fundraising unless the activity would have been undertaken even without the solicitation of support.
Reporting on T3010