The effect on your personal income taxable payable for cash donations

On the first $200.00 of donations made by an individual, there is a tax credit of 25.8%.  On any amount above that, the tax credit is 46.4% if your taxable income is below $205,842.00.

Example 1

On a donation of $2,000.00 by an individual having less than $205,842.00 in taxable income, the tax credit would be as follows:

$200.00 @ 25.8% = $51.60
$1,800.00 @ 46.4%* = $835.20   
Total tax credit** = $886.80

*The rate of 46.4% applies to your donations over $200.00 regardless of your tax bracket up to the $205,842 bracket as noted in the following example.
**This tax credit is deducted directly off of your taxes payable for the year.

If your taxable income is above $205,842.00, the amount of income above $205,842.00 can earn a higher tax credit after deducting the first $200.00 of donations.

Example 2

On a donation of $20,000.00 by an individual having $210,000.00 in taxable income, the tax credit would be as follows:

$200.00 @ 25.8% = $51.60
$9,800.00 @ 46.4% = $4,547.20
$10,000.00 @ 50.4% = $5,040.00
Total tax credit* = $9,638.80

*This tax credit is deducted directly off of your taxes payable for the year.

Notes on cash donations

  • Donations used in a single year are limited to 75% of your net income.

  • Donations can be carried forward for up to five years.

  • The tax rates in our example are calculated using Manitoba provincial tax rates. These rates may differ if you pay taxes as a resident of a different province.

Donation of Securities

Another option for supporting this project is a donation of securities, which may offer additional tax advantages to the donor including not having to report the capital gain.  Contact Barb Lepp at (204) 750-3350 or email at barb.lepp1@gmail.com to discuss this option.

It is very important to consult your tax advisor about the donation you wish to make, to ensure you are making the donation in a way that works best for your tax situation.