• Last Updated:
  • Dec 21st, 2020 1:19 pm
[OP]
Newbie
Sep 15, 2018
40 posts
2 upvotes

Donation Receipt for business

Hi, I work as web developer and I was contacted by small non for profit organization (registered charity in Canada), they like to have a website but they only have budget $300. so I told them that is too low, they said they can give you donation receipt too for the work.

So I'm not sure how that will work. they only giving $300 but they said they will also provide me a donation receipt for $1000

What I can do in this situation, as this is new to me, and can they issue donation receipt for the worth of the work.

Do I need to create invoice for $1300 to them or only $300. or how this will work?
how I'm going to record it in QuickBooks. and then in my income tax?


Please help.
10 replies
Jr. Member
Apr 2, 2020
191 posts
73 upvotes
I'm sure you know that this isn't legal.
Jr. Member
User avatar
Jun 3, 2008
164 posts
184 upvotes
Newmarket
loudyca wrote: Hi, I work as web developer and I was contacted by small non for profit organization (registered charity in Canada), they like to have a website but they only have budget $300. so I told them that is too low, they said they can give you donation receipt too for the work.

So I'm not sure how that will work. they only giving $300 but they said they will also provide me a donation receipt for $1000

What I can do in this situation, as this is new to me, and can they issue donation receipt for the worth of the work.

Do I need to create invoice for $1300 to them or only $300. or how this will work?
how I'm going to record it in QuickBooks. and then in my income tax?


Please help.
I can't see how you'd benefit from this.

If you treated this as a charitable contribution through your company, you'd need to invoice for $1300, treat $300 as receivables and $1000 as a donation (expense). You'd be no better off except you'd have a $1000 expense to explain to CRA.
So you are no further ahead than if you'd just charged $300.

If you are getting a charitable receipt personally, you are likely doing something illegal or at a minimum, tax evasion.
I'd be very worried about any charity that will issue donation receipts like this, they are typically the ones that come under CRA scrutiny.

IMO decide based on the $300 and client reference you may obtain from the task. Charity has its own rewards.
Jr. Member
Apr 2, 2020
191 posts
73 upvotes
Disclosure: I'm not an accountant.

It's my understanding that you can't receive a tax receipt for services. I suppose you could invoice the charity for $1,300 have the charity pay you then donate $1,000 back to them. Of course, you will have to show that you regularly charge $1,300 for your services and didn't inflate your fee in any way.
[OP]
Newbie
Sep 15, 2018
40 posts
2 upvotes
Thank you all, usually I charge $3000 for this type of work but I thought to help them, as I have done lots of charity works and never asked for payment. But they offered me that this time.

But it seems the Canadian government is complicated when it comes to legitimate tax deductible expenses. But they are more than happy to give money out to Air Canada and the big corporations i oil and gas who pays monthly to their ceo what i can make in 50 years of working and to pay dividend to their shareholders. Wow what a great socialism system here.
Deal Fanatic
Oct 7, 2007
8350 posts
4308 upvotes
loudyca wrote: Thank you all, usually I charge $3000 for this type of work but I thought to help them, as I have done lots of charity works and never asked for payment. But they offered me that this time.

But it seems the Canadian government is complicated when it comes to legitimate tax deductible expenses. But they are more than happy to give money out to Air Canada and the big corporations i oil and gas who pays monthly to their ceo what i can make in 50 years of working and to pay dividend to their shareholders. Wow what a great socialism system here.
More than happy to give TAXPAYERS' hard-earned money out. (Some people don't realize where the government actually gets its money.)
[OP]
Newbie
Sep 15, 2018
40 posts
2 upvotes
Yes that is correct, they become so strict on small business and personal taxes. But if the big corporations needs the money they give them without accountability.

Even thought the big corporations do not pay taxes because they fligh their employees on first class seats and they give spending accounts to their staff Face With Rolling Eyes

Very nice of them.
Deal Fanatic
Oct 7, 2007
8350 posts
4308 upvotes
loudyca wrote: Yes that is correct, they become so strict on small business and personal taxes. But if the big corporations needs the money they give them without accountability.

Even thought the big corporations do not pay taxes because they fligh their employees on first class seats and they give spending accounts to their staff Face With Rolling Eyes

Very nice of them.
And that is just an example you know about. Some are asking about others but this is yet to be revealed. I don't necessarily believe all that I read and don't trust most media sources but this will give you some flavour of what I am referring to:
https://www.cbc.ca/news/politics/covid- ... -1.5826917
Deal Fanatic
User avatar
Dec 21, 2005
5435 posts
775 upvotes
Markham
If the not-for-profit is openly doing this, they should be reported to the CRA.

The Charities Directorate discuss this issue here:
https://www.canada.ca/en/revenue-agency ... vices.html

IF there was an actual payment coming from the charity for $3000 and you donate back $2700 via another cheque/EFT/etc, that's a different story (and the CORRECT way of getting a donation receipt)
:idea: :) :lol: :razz: :D
Member
Feb 15, 2018
333 posts
406 upvotes
Talk to an accountant. Instead of making it a donation how about make it some kind of promotional expense on your end.

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