| February 19, 1990 | |
| Provincial and International | Business and General |
| Relations Division | Division |
| R.B. Day | |
| B. Fioravanti | 957-2136 |
| File No. 7-4677 |
Re: Non-Gratuitous Cash Donations to the Crown (Your File 4172-4-7)
We are writing in reply to your memorandum of January 29, 1990, wherein you requested our views regarding the income tax implications for such donations relative 24(1)
Our Comments
It is our opinion that non-gratuitous cash donations would not, generally, qualify as "gifts", for purposes of paragraph 110.1(1)(b) and subsection 118.1(1) "Total Crown Gifts", because,
"A gift may be defined as a voluntary and gratuitous transfer of real or personal property. There must be a donor who gratuitously disposes of the property and there must be a donee who receives the property given. No right, privilege, material benefit or advantage may accrue to the donor or to a person designated by the donor" (IT-297R paragraph 1).
24(1)
We have been advised by Charities Division that, in situations where gifts are made to Registered Charities for charitable purposes and the gifts are designated for specific use by the donor, such gifts are acceptable provided that no benefit accrues to the donor and the designated gift does not benefit any person not dealing at arm's length with the donor.
We have also given favourable advance income tax rulings where a specific Act of a provincial legislature has established a corporation that is, in fact and law, an agent of Her Majesty in right of the particular province and which is set up to accept gifts from the public at large for a particular purpose.
24(1)
M.G. Hiltz for Director GeneralSpecialty Rulings DirectorateLegislative and Intergovernmental Affairs Branch