On January 6, 2025, Her Excellency the Right Honourable Mary Simon, Governor General of Canada, prorogued Parliament.

With prorogation, all parliamentary activities are suspended. Originally scheduled to reconvene on January 27, Parliament will not meet until March 24 at the earliest.

Prorogation – and the possibility of an early election – creates uncertainty for Canadians.

In particular, donors and charities are asking: how much can Canadians rely on Ottawa’s December 30 announcement that the 2024 charitable donation deadline would be extended to the end of February 2025?

Additionally, what practical steps can donors and charities take when making and receiving donations this January/February amidst the uncertainty?

Background

On December 30, 2024, the Government of Canada announced, via news release, that it would extend the 2024 charitable donation deadline to February 28, 2025.

To effect this change, Ottawa indicated it would introduce legislation to amend the Income Tax Act “once Parliament returns in the new year.”

On December 31, 2024, the Government of Quebec announced that Quebec would also follow suit in extending the 2024 charitable donation deadline. With the federal Parliament prorogued, it is not clear whether Quebec’s planned extension would go forward as well.

What is the status of a tax proposal without legislation?

With Parliament not convening until late March, it is almost certain that Canadians will not see draft legislation before the February 28 donation deadline.

The absence of enabling legislation, however, does not mean that the proposal is dead or that Canadians should not rely on the proposed extension.

Typically, the government announces changes to the Income Tax Act or to tax policy that take effect as of a specific date and then introduces legislation in Parliament that, when passed, applies retroactively to the effective date.

At present, we do not know:

  • whether Parliament, when it reconvenes in March, would introduce legislation to extend the 2024 donation deadline to February 28;
  • what the content of such legislation would be;[1]
  • whether such legislation, if introduced, would make its way through Parliament before an election is called;
  • whether the government would survive a confidence vote when Parliament is recalled; or
  • whether a new government, if any, would introduce the legislation in a new session of Parliament or what that new legislation would look like.

Considerations for donors

Donors who are interested in making gifts this January/February intending them to be recognized in 2024 may have no choice but to donate before the end of February and accept some uncertainty. 

What can these donors consider in the face of such uncertainty? Donors who wish to have their January/February donations qualify for 2024 tax support can:

  • Express this intention in writing to the charity when making their gift, as well as to their tax advisor. This should ensure that the donor, the charity, and the tax advisor are all on the same page with respect to the donor’s intentions with the gift. 
  • Request an official donation tax receipt from the charity immediately after any cash gift is received. This should permit the donor and their tax advisor to claim the donation on the donor’s 2024 income tax return when they file before April 2025 if the donation deadline were changed as announced.
  • Provide donation receipts to their tax advisors and also inform them about their intention to have their January/February donation qualify for 2024 tax relief. This would help prevent miscommunication and ensure that the donor’s 2024 income tax return is filed in a way that is consistent with the donor’s intention if the donation deadline were changed as announced.
  • Be careful not to “double-dip” or inadvertently reuse a 2025 donation receipt for 2025 tax purposes when filing in 2026. (This presupposes that the law permits the donor to use the 2025 donation receipt for 2024 tax support, and that the donor did in fact do so.)
  • Seek legal and other professional advice, particularly if they plan to make major or transformational gifts in January/February (intending these gifts to qualify for 2024 tax relief). The greater the gift, the more cautious the donor should be.

This list is not exhaustive.

Considerations for charities

Gifts by mail

As a result of the postal strike, it is not uncommon for charities to receive, in the mail, cheques that have a 2024 date but whose envelopes are postmarked with a 2025 date.

In these situations, the date of the official donation tax receipt should be the date of the postmark, not the date of the cheque. This is because the CRA considers the date of donation to be the date of the postmark on the envelope when a charity received a donation by mail.[2] The CRA recommends that charities keep stamped envelopes as part of their books and records.

No backdating

With the exception of certain gifts by mail (see above), if a charity receives a gift in January/February 2025, the charity should not issue a receipt with a 2024 date – even if the donor intends to use the receipt for 2024 tax purposes until there is more certainty about the donation deadline. By way of reminder, CRA policy is that that charities cannot issue a receipt with a date that precedes the transfer of the donation.

Cash gifts

Generally, in the normal course:

  • Charities can issue a single official donation tax receipt to a donor for all the cash gifts that the donor has made in a year;[3]
  • This single receipt could state the year only (being the year in which the charity received the cash gifts); and
  • Charities are not required to issue donation receipts automatically or within a certain timeframe (though the CRA suggests that charities issue receipts by February 28 of the calendar year that follows the year of the donation).

With the proposed donation deadline extension, however, charities should rethink these practices—and reconsider how and when they should issue receipts for cash gifts received in January/February 2025 if the extension of the donation deadline actually becomes law.

For instance, if a charity receives a cash gift on January 31, 2025 from a donor, the charity could consider issuing a separate official donation tax receipt to the donor for the January 31st gift (rather than one single receipt for all cash gifts made in 2025). The charity could issue the receipt as soon after January 31, 2025 (and not wait any longer). The receipt could also show the day, month, and year in which the charity received the cash gift, being January 31, 2025 (and not only the year).

This practice would help ensure that donors are in a position to claim tax credits in 2024 for their January/February 2025 donations, whether or not those donors intend to claim those credits in 2024 if the extension of the donation deadline were to become law. It could also help charities from being inundated with receipt requests from donors closer to the April 2025 tax filing deadline.

Many larger and well-resourced charities will already automatically issue an official donation tax receipt to a donor shortly after the donor makes the gift. Some charities, however, may not have these capabilities. We understand that, in response to the government’s December 30 announcement, some charities have put the onus on the donor to request an official donation tax receipt for a January/February donation if they wish to receive one. Whether a charity should adopt this practice, or a different practice, is fundamentally a business decision of the charity.

In our view, if it is not unduly complicated, expensive, or burdensome, all charities should consider issuing separate official donation tax receipts for cash gifts received in January and February 2025 to donors and should do so as soon after the gift is received – for all the reasons that we stated earlier. We recognize and acknowledge that not all charities have the resources or bandwidth to adopt this practice.

Donor communications

In light of the ongoing uncertainty surrounding the extension, charities could consider updating their policies and issuing disclaimers to donors.

A possible disclaimer could inform donors that:

  1. The charity will continue to issue receipts in the normal course, bearing the date on which the gift is transferred to the charity according to CRA policy; and
  2. It is the donor’s responsibility to determine, in consultation with their professional advisors, whether a gift received in January or February 2025 is eligible for 2024 tax relief.

Policies and disclaimers could help manage donor expectations and insulate the charity from future disputes or challenges. Legal counsel could help advise on specific messaging.

Have questions about this article? Have a specific gifting or receipting question? A member of Miller Thomson’s Social Impact Team can help.

[1] Note: After the December 30th announcement but before this article’s publication, a spokesperson for the Department of Finance clarified to The Globe and Mail that individuals making donations in January and February this year would be able to claim these donations on either their 2024 or 2025 tax returns (or in any of the following five taxation years). Although the clarification from Finance is helpful, we still do not know what the content of the actual legislation, if any, would be.

[2] Gifts by mail are an exception to the general rule that the date of donation is the date the gift is actually received by the charity.

[3] For gifts-in-kind and non-cash donations, a charity must issue a separate receipt for each gift.