Understand what charitable receipts and documentation are needed

Claiming a tax credit for charitable donations is one of the most effective and accessible ways to reduce your tax bill in Canada. But if your receipts are missing, incorrect, or incomplete, the Canada Revenue Agency (CRA) may deny your claim—even if the donation itself was legitimate.

This matters when you're preparing your tax return, supporting charities through workplace giving, or donating physical items like clothing, electronics, or furniture. Proper documentation ensures your generosity is reflected not just in the community, but on your return too.

Let’s walk through the types of receipts you need, how donations through your employer are handled, and what’s required when you donate goods instead of money.

What Kind of Receipt Do You Need?

To claim a donation tax credit, you must have an official donation receipt issued by a registered charity or qualified donee. The receipt must follow CRA guidelines in format and detail.

A valid donation receipt must include:

• The name and address of the charity

• The charity’s registration number

• Your full legal name and address

• The amount donated

• A statement that it is an official receipt for income tax purposes

• The date of the donation and date the receipt was issued

• A unique serial number

• The signature of a representative of the charity

• For non-cash gifts: a detailed description of the item and its fair market value

The CRA allows digital receipts, such as emailed PDFs, as long as all these elements are included.

Documentation Requirements by Donation Type

Donating Through Your Employer

Many Canadians support charities through payroll giving programs, which deduct donations directly from your paycheck. These programs are convenient and tax-effective, but the documentation process differs slightly from personal donations.

If your payroll donation appears in Box 46 of your T4 slip, no separate receipt is needed—you can claim that amount on your return directly.

If the donation does not appear on your T4, request an official tax receipt from the charity or the organization managing the payroll campaign (such as United Way or Benevity).

Donating Goods: What Qualifies and What Doesn’t

Donating goods—also known as gifts-in-kind—can be eligible for a donation credit, but only if properly documented and issued by a registered charity.

You can claim the fair market value (FMV) of the item on the date it was donated, provided the charity gives you an official receipt with a description and valuation of the item.

Items you can donate for a credit:

• Clothing, books, and small appliances (if accepted by the charity)

• Artwork, furniture, electronics

• Musical instruments or sports equipment

• Business inventory (if not claimed as a business deduction)

What’s not eligible for a donation receipt:

• Services (e.g., donated time or skills)

• Use of property without transfer of ownership

• Items donated to non-registered charities or informal community groups

• Goods with no documented fair market value

If the value of the item exceeds $1,000, the CRA requires the charity to obtain an independent appraisal before issuing the receipt.

At Optimize, we help assess whether a non-cash donation is claimable and how to value it appropriately, especially if you are donating appreciated personal or business property.

Special Case: Donating Securities

Donating publicly traded securities or mutual funds directly to a registered charity offers two advantages:

1. You receive a tax receipt for the full fair market value of the security

2. You do not pay capital gains tax on any growth in the investment

This makes it one of the most tax-efficient ways to give, especially if you have significant gains in a non-registered account.

The donation must be transferred directly to the charity to qualify for these benefits. Selling the asset first, then donating the proceeds, eliminates the capital gains exemption.