Topics: News, What's New from the Charities Directorate of CRA, Canadian Charity Law, Ethics and Canadian Charities, Avoiding 'Charity' Scams
On October 3, 2014, CRA released an updated resource on tax shelter arrangements on the CRA website. This page provides detailed information on what is a tax shelter, provides links to case law dealing with tax shelters, and cautionary steps for individuals considering getting involved in a tax shelter.
The release can be accessed at http://www.cra-arc.gc.ca/gncy/lrt/vshlt-eng.html.
CRA notes on their tax shelter page: "Mass marketed gifting tax shelter arrangements are made for the primary purpose of avoiding the payment of the required taxes rather than raise funds for charities. Mass marketed gifting tax shelters include schemes where taxpayers receive a charitable donation receipt with a higher value than what they paid. This can typically be four or five times their out of pocket cost. The Canada Revenue Agency (CRA) audits every mass-marketed tax shelter arrangement and no arrangement has been found to comply with the Income Tax Act."
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Mark Blumberg is a partner at the law firm of Blumberg Segal LLP in Toronto and works almost exclusively in the areas of non-profit and charity law.