Enduring Property

Receipting - Enduring Property


Notice to the Reader
As a result of Budget 2010, the information on this page applies only for fiscal periods ending before March 4, 2010.

EP1. What is included in enduring property?

EP2. When are gifts of enduring property (excluding inter-charity transfers) included in a registerd charity's disbursement quota?

EP3. If a charity receives enduring property from a registered charity, is their a disbursement quota obligation for the recipeint charity?

EP4. If a charity transfers enduring property which it received as a specified gift, is there a disbursement quota obligation for that donor charity?

EP5.If a charity transfers enduring property as a specified gift, is there a disbursement quota obligation for the ceipient charity?

EP6. What is a bequest?

EP7. When a individual makes a gift through his or her will, when is the gift deemed to have been made?

EP8. Can a charity issue a receipt prior to the transfer of property by the deceased's estate?

EP9. If a will allows trustees to decide on the way property is disposed, either to a charity or to another organization, can a donation receipt be issued for the property that the trustees donate to a charity?

EP10. If the terms of a person's will specify that property be used to establish a charitable foundation, can a donation receipt be issued if the charity is registered?

EP11. Can a deceased individual obtain an official receipt for tax purposes when a charity had been designated as a beneficiary of a registered retirement income fun?

EP1. What is included in enduring property?

Notice to the Reader
As a result of Budget 2010, the information on this page applies only for fiscal periods ending before March 4, 2010.

EP1. What is included in enduring property?

While there are some specific exceptions, enduring property of a registered charity generally includes:

A gift received by way of bequest or inheritance
may include direct distributions of proceeds to a registered charity that is the designated beneficiary of a life insurance policy, a registered retirement savings plan, or a registered retirement income fund.

A gift received by a charitable organization from another registered charity that is subject to a trust or direction to the effect that the property given, or property substituted for the gift,
is to be held by the charitable organization for a period of not more than five years from the date the gift was received and is to be expended in its entirety over the period referred to in the trust or direction to acquire a tangible capital property to be used in charitable activities or administration; and/or in the course of a program of charitable activities of the charitable organization that could not reasonably be completed before the end of the first fiscal period following the fiscal period in which the gift was received.

A gift received by a charity that is subject to a trust or direction to the effect that the property given, or property substituted for the gift, is to be held by the charity for a period of not less than 10 years (a “10-year gift”)
The trust or direction may permit the charity to transfer the enduring property to another registered charity (the “transferee charity”), subject to the same terms and conditions of the original gift. It may also permit the charity, or the transferee charity, to expend such amount of the gift or the substituted property before the end of that period, to the extent necessary to meet the 3.5 per cent disbursement quota requirement.

A gift received by a charity from another charity
that was a bequest or inheritance of the other charity or a ten-year gift of the other charity, and in the case of a ten-year gift, is subject to the same terms and conditions of the original gift.


(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)

EP2. When are gifts of enduring property (excluding inter-charity transfers) included in a registered charity's disbursement quota?

Notice to the Reader
As a result of Budget 2010, the information on this page applies only for fiscal periods ending before March 4, 2010.

EP2. When are gifts of enduring property (excluding inter-charity transfers) included in a registered charity’s disbursement quota?

Gifts of enduring property (for example, bequests or 10-year gifts) are only included in the disbursement quota when a charity spends or transfers some or all of this enduring property. However, such gifts must be considered when calculating the average value of property for a charity’s 3.5 per cent disbursement quota requirement.

(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)

EP3. If a charity receives enduring property from a registered charity, is there a disbursement quota obligation for the recipient charity?

Notice to the Reader
As a result of Budget 2010, the information on this page applies only for fiscal periods ending before March 4, 2010.

EP3. If a charity receives enduring property from a registered charity, is there a disbursement quota obligation for the recipient charity?

Enduring property (for example, a 10-year gift) received from another charity is generally excluded from the recipient’s disbursement quota in the year it is received. When the recipient charity spends or transfers some or all of its enduring property, the amount spent or transferred must be included when calculating the disbursement quota (unless it was received as a specified gift). The recipient charity must also consider enduring property when calculating average value of property for its 3.5 per cent disbursement quota requirement.

For more information on ten (10) year gifts see:
www.cra-arc.gc.ca/chrts-gvng/chrts/prtng/gfts/10gft-eng.html
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(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)

EP4. If a charity transfers enduring property which it received as a specified gift, Is there a disbursement quota obligation for that donor charity?


Notice to the Reader
As a result of Budget 2010, the information on this page applies only for fiscal periods ending before March 4, 2010.

EP4. If a charity transfers enduring property which it received as a specified gift, is there a disbursement quota obligation for that donor charity?

No. Enduring property that was received as a specified gift is excluded from the donor charity’s disbursement quota. There are errors in the (’05) version of Form T3010A regarding the reporting of enduring property and specified gifts. Since Form T3010A is not being revised this year, Guide T4033A, Completing the Registered Charity Information Return, will be amended to instruct charities in such circumstance to include the amount on line 4920 “Other expenditures,” and on line 5000 “Total charitable programs expenditures” included in line 4950.

(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)

EP5. If a charity transfers enduring property as a specified gift, is there a disbursement quota obligation for the recipient charity?


Notice to the Reader
As a result of Budget 2010, the information on this page applies only for fiscal periods ending before March 4, 2010.

EP5. If a charity transfers enduring property as a specified gift, is there a disbursement quota obligation for the recipient charity?

No. Enduring property received as a specified gift is excluded from the recipient charity’s disbursement quota. The charity should include the amount on line 4510 “Total amount received from other registered charities” and on line 4520 “Total specified gifts” in line 4510 of Form T3010A (05).

The donor charity cannot use the specified gift to satisfy its own disbursement quota.

Specified gifts should be identified as such in the books and records of the donor charity and recipient charity.

(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)

EP6. What is a bequest?

EP6. What is a bequest?

A bequest is property that a registered charity receives from the will of a deceased person. Under the Income Tax Act, a bequest is a gift of enduring property. Bequests are generally excluded from a charity's disbursement quota in the year they are received. However, the charity must consider these gifts when calculating the average value of property for its 3.5 per cent disbursement quota requirement. Also, bequests must be included in calculating the charity's disbursement quota in the year in which they are spent or transferred to a qualified donee.

(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)

EP7. When an individual makes a gift through his or her will, when is the gift deemed to have been made?

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EP7. When an individual makes a gift through his or her will, when is the gift deemed to have been made?

Under subsection 118.1(5) of the Act, “…where an individual by the individual’s will makes a gift, the gift is, for the purpose of this section, deemed to have been made by the individual immediately before the individual's death.

For gifts in kind, the value of the gift is considered to be its fair market value immediately before death and not when the property is subsequently received by the charity.

(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)

EP8. Can a charity issue a receipt prior to the transfer of property by the deceased’s estate?

EP8. Can a charity issue a receipt prior to the transfer of property by the deceased’s estate?

No. A donation tax credit can, however, still be claimed on the deceased taxpayer’s final return. Where the charity receives a letter from the estate advising of the gift and its value, the registered charity can issue a letter to the estate acknowledging the gift and stating that it will accept the gift.

(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)

EP9. If a will allows trustees to decide on the way property is disposed, either to a charity or to another organization, can a donation receipt be issued for the property that the trustees donate to a charity?

EP9. If a will allows trustees to decide on the way property is disposed, either to a charity or to another organization, can a donation receipt be issued for the property that the trustees donate to a charity?

Yes. Where the trustees exercise their discretion to donate property to a charity, a receipt can be issued for the fair market value of the property and a donation tax credit may be claimed on the trust return filed by the estate.

A donation tax credit can be claimed on the deceased taxpayer’s final return where the terms of the will provide that a donation of a specific property, a specific amount, or a specific percentage or part of the residue of the individual’s estate is to be gifted to a charity.

In a situation where the individual’s will directs his or her trustee to make a donation to charity without identifying a particular charity, this, in itself, does not stop the donation from qualifying as a gift by will.

(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)

EP10. If the terms of a person’s will specify that property be used to establish a charitable foundation, can a donation receipt be issued if the charity is registered?

EP10.If the terms of a person’s will specify that property be used to establish a charitable foundation, can a donation receipt be issued if the charity is registered?

Yes. The fact that the foundation did not exist at the time of the individual's death does not rule out a donation from qualifying as a gift “by will” for the purposes of subsection 118.1(5) of the Act as long as the foundation is a qualified donee when the gift is completed. The completion of the gift should occur within a reasonable period after the death.

(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)

EP11. Can a deceased individual obtain an official receipt for tax purposes when a charity has been designated as a beneficiary of a registered retirement income fund?

EP11.Can a deceased individual obtain an official receipt for tax purposes when a charity has been designated as a beneficiary of a registered retirement income fund?

Yes. Under the Income Tax Act, a charitable donation tax credit can be claimed on a deceased individual's return for a donation of a direct distribution of proceeds to a qualified donee who is the designated beneficiary of a registered retirement savings plan (RRSP), a registered retirement income fund (RRIF), or a life insurance policy, provided certain conditions are met.

(Reprinted with permission from Info Sheet #12 Enduring Property by Charities Files)