Line 349 - Donations and gifts

Use this line to claim charitable donations the deceased, or his or her spouse or common-law partner, made before the date of death and complete Schedule 9, Donations and Gifts.

Support the claims for donations and gifts with official receipts that the registered charity or other qualified donee has issued, showing either the deceased's name, or the deceased's spouse's or common-law partner's name.

A first-time donor’s super credit (FDSC) will increase the value of the federal charitable donations tax credit by 25% on donations made after March 20, 2013, if neither the deceased nor his or her spouse or common-law partner has claimed the credit since 2007. The FDSC will apply on up to $1,000 in donations of money claimed in respect of any one taxation year from 2013 to 2017. For more information, see Line 349 - Donations and gifts.

As the legal representative, you must attach supporting documentation for the donations made. The type of supporting documentation you have to provide depends on when the registered charity or other qualified donee will receive the gift:

  • For gifts that will be received right away, provide an official receipt.
  • For gifts that will be received later, provide a copy of each of the following:
    • the will;
    • a letter from the estate to the charitable organization that will receive the gift, advising of the gift and its value; and
    • a letter from the charitable organization acknowledging the gift and stating that it will accept the gift.

You may be able to claim a charitable donations tax credit for a designation donation (a donation of a direct distribution of proceeds to a qualified donee from an RRSP (including a group RRSP), RRIF, a tax-free savings account (TFSA), or life insurance policy (including a group life insurance policy) as a result of a beneficiary designation). The above does not apply if the qualified donee is the policyholder or an assignee of the deceased person's interest in the policy.

What's new

For deaths that occurred before 2016, the eligible amount of gifts that a deceased person gave in the year of death, including estate donations (donations made by will and designation donations) could be claimed on the deceased’s final return and the return for the preceding year.

For deaths that occur after 2015, estate donations are no longer deemed to be made by an individual immediately before the individual’s death. Instead, these donations are deemed to be made by the individual’s estate and where certain conditions are met, by the individual’s graduated rate estate (GRE).

GRE donations are donations by a graduated rate estate to a qualified donee. The donated property must be property that was acquired by the estate on and as a consequence of the death (or property that was substituted for such property). GRE donations include those made through the will and designation donations.

You can allocate a GRE donation among any of:

  • the taxation year of the GRE in which the donation is made,
  • an earlier taxation year of the GRE, or
  • the last two taxation years of the deceased individual (the final return and the return for the preceding year).

In addition, under proposed changes, for 2016 and future taxation years, a gift made after the 36 month period but within 60 months after the date of death by a former GRE that continues to meet all of the requirements of a GRE except for the 36 month time limit, can be allocated among any of:

  • the taxation year of the estate in which the donation is made; or
  • the last two taxation years of the deceased individual (the final return and the return for the preceding year).

An estate, whether it is a GRE or not, can claim a charitable donations tax credit for an estate donation in the year in which the donation is made or in any of the five following years (or 10 years for a gift of ecologically sensitive land made after February 10, 2014). However, an estate that is not a GRE or a former GRE (within 60 months of the date of death) cannot allocate a donation made by the estate to a taxation year of the individual or an earlier year of the estate.

Generally, when an individual dies, the individual is deemed to have disposed of all capital property immediately before the individual’s death.

Where the estate of an individual donates property that was the subject of a deemed disposition by the individual immediately before the individual’s death, and the property’s fair market value upon transfer to the qualified donee has changed, the difference will result in a gain or loss to the estate that will generally be recognized for income tax purposes. This will be the case whether or not the donation is a GRE donation or a former GRE donation.

If the property is certified cultural property or ordinarily benefits from a capital gains inclusion rate of zero, see the sections called “Gifts of certified cultural property” and “Capital gains realized on gifts of certain capital property” in Pamphlet P113, Gifts and Income Tax. However, if the property donated:

  • is a property that benefits from a capital gains exemption or exclusion when donated as described in the sections of Pamphlet P113 referenced above; and
  • where the estate is a GRE and the donation is a GRE donation,

the same treatment will apply to the capital gain on the deemed disposition of the property immediately before the individual’s death. Under proposed changes, this treatment will also apply to former GRE donations.

Additional special rules exist for the proceeds of disposition and cost amount of gifts of art, from the artist’s inventory, on and as a consequence of the artist’s death.

The deceased may have donated amounts in the five years before the year of death. As long as the deceased did not previously claim the amounts, you can claim them in the year of death. Where part of a donation has already been claimed, attach a note to the return giving the amounts and the year or years the donations were made. Also, attach any receipts that were not attached to previous returns, if applicable.

Note

Charitable donations cannot be carried forward from a T1 return to a T3 return.

For information on the amount that can be claimed, see Limitations on claim amount of gift.

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