10 Ways to Optimize Your Taxes Through Charitable Giving

10 Ways to Optimize Tax Returns

Are you planning your finances as we close out 2022? Well, consider this. Giving to charities allows you to help others and positively impact the community while also providing tax benefits. To help you get the most out of your end-of-year tax planning, here are 10 ways you can optimize your taxes through charitable giving:


Make sure that any donations you make are eligible for a tax credit. Charitable organizations must be registered with the Canada Revenue Agency (CRA) before issuing official donation receipts for income tax purposes.


Make an end-of-year lump sum donation to maximize your benefit on the current year’s taxes. The more money you donate in one payment, the larger the tax credit you’ll receive.


Donate capital property, such as stocks and mutual funds, instead of cash. Doing this allows you to avoid any taxes on capital gains while still getting a receipt for the total market value of your gift.


Donate by payroll deduction if your employer offers it. This type of donation is especially beneficial because pre-tax dollars are used, meaning you end up paying fewer taxes overall.


Consider setting up a charitable endowment fund or donating appreciated real estate to reduce end-of-year taxes in Canada. These types of gifts have unique benefits that can help lower your taxable income significantly in some cases.


Make sure to itemize your tax return. Charitable donations are considered a deduction on your taxes, so you need to ensure that you’re itemizing them to get the most benefit possible.


Donate goods instead of money if it makes sense to you. Donating items such as furniture or clothing can also result in end-of-year tax savings in Canada, provided that the organization is registered with the CRA and can provide an official receipt for income tax purposes.


Look into claiming end-of-year credits on your provincial tax return and your federal one if applicable in your province. Many provinces offer additional charitable giving incentives that can help reduce end-of-year taxes even further.


Keep all of your donation receipts and records in one place. This will make it much easier to keep track of end-of-year charitable donations for tax purposes.


Don’t forget about end-of-year matching gifts! Many employers offer end-of-year matching gift programs, so look into it if you’re considering making a sizeable donation. Doing this can result in even more end-of-year tax savings than expected.

Thank You!

By following these tips, you can maximize your end-of-year taxes savings in Canada through charitable giving while also helping those in need. Reach out to the donor care team at Human Concern International to explore the options available to you. We’ve always got unique projects that can use extra help.

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In The Field

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