R20. Is there anything else that our charity should know about false receipting?

R20. Is there anything else that our charity should know about false receipting?


Long answer

The Canada Revenue Agency (CRA) has a growing concern regarding false receipts discovered when auditing individual’s income tax returns. Some of the false receipts have been produced by the charities themselves; some have been created by others without the charity even being aware of the scheme.

Charities should take the utmost care to protect and ensure the integrity of their official income tax receipts. Not only is it important to keep proper books and records of all donations so that accurate receipts can be issued, but also so that amounts can be verified if reviewed or audited by the CRA.

It is equally important to maintain adequate internal controls to restrict access to the receipts and related software programs:

  • All blank receipts should be kept in a fireproof safe;
    or
  • at a minimum, under lock and key in a secure storage room.
  • Computer programs should be password protected with access restricted to those who are responsible for issuing the receipts.

Your charity may receive a request from the CRA asking for the donor’s name and the amount on a particular receipt by number. This is one way they determine if a taxpayer’s receipt is valid.