Canada Post Strike

In the midst of the Canada Post strike, what are charities to do?

First, check newsroom updates from Canada Revenue Agency (CRA) and sign up for the Charities newsletter. There you will find some suggestions about how to handle any disruptions caused by the strike.

Reporting

CRA encourages charities to file annual information returns (T3010) online using My Business Account (MyBA). If your charity does not have a MyBA account you can register online.

If that is not possible, alternative filing options (e.g. by fax) are available. Contact CRA to discuss the best option for your organization.

Receipting

Again, charities can contact CRA with questions about receipting gifts and issuing donation receipts. But it is helpful to first understand the general rules around receipting year-end donations received by mail.

Receipting Regulation

The starting point for any receipting question is to look at the Income Tax Regulations, Regulation 3501. It explains that:

• Where the gift is a cash gift, the receipt must show the date on which, or the year during which, the gift was received
• Where the gift is a gift of property, the receipt must show the date on which the gift was received (among other things)

Receipting Donations Sent By Mail With Postmark

When donations are received by mail, the Canada Revenue Agency considers the envelope’s postmark date to be the donation date. Your charity needs to keep the stamped envelope as part of its books and records.

This means that if a cheque dated December 31 is received January 5, it can still be receipted for the December 31 date, so long as the envelope is postmarked prior to the new year.

Charities need to be mindful of the date written on the donation itself to ensure a cheque is not post-dated into the new year.

Receipting Donations Sent by Mail Without Postmark

When donations are received by mail without a postmark, your charity needs to be consistent and show good faith in how the donation is processed and recorded.

If the envelope arrives along with other envelopes all postmarked December 31, and the donation cheque is dated for the prior year, it may be reasonable to include it in the prior year.

If the envelope arrives along with other envelopes that have mixed postmarked dates, it may be reasonable to include it in the new year.

Receipting Donations Consistently

It is up to your charity to set its own policy on how it will treat end-of-year donations. Your charity may choose to (1) determine, using postmarks, whether the donation should be receipted for the current year or (2) treat any gift delivered on or after January 1 as a gift for the new year.

Your charity should be consistent in this choice and should advise donors ahead of time. Your approach should be set out in a gift acceptance policy so that staff, stewardship representatives, fundraisers, and donors are all aware and informed.

Your charity may also choose to incorporate a ‘cut-off’ date that is determined each year, depending on the calendar, holidays, and staffing – e.g. the Friday ahead of New Year’s Day when that day falls on weekend. A simple addition to your gift acceptance policy can address year-end gifts.

Impact of the Strike

The postal disruption will make determining the date of the donation challenging. It is possible that some gifts may not be postmarked until the new year, though intended for the 2024 tax year, or that some gifts may not be postmarked at all.

We have written to the CRA to ask for clarity and guidance for charities in these situations and will keep you updated if and when we receive a response.

Additional Resources

We’ve got more information on official donation receipts in our Member Knowledge Base, and you can stay up to date with discussions on the strike and MyBA in The Green.