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Sponsorship vs Donations for Canadian businesses and registered charities

Sponsorships can be important for Canadian charities and businesses but they are different than donations and it is vital to understand the rules and the differences.

$299

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There is much confusion in Canada, both in businesses and charities, about “sponsorships” vs. gifts. This confusion can lead to friction between charities and businesses and bad outcomes for both sides.

The Canada Revenue Agency (CRA) has specific rules for businesses regarding sponsorship vs. donations, and it’s important for businesses and charities to understand the differences.

This is a 2-hour course that was originally recorded on September 12, 2024.

There is a difference between a business making a donation to a registered charity and a business entering into a sponsorship arrangement. When a business provides sponsorship to a charity or to a charitable event, it is generally not a gift, and a charity generally cannot issue an official donation receipt for sponsorship. If a business gives funds to a charity and the charity issues an official donation receipt for the “gift,” then generally, the charity cannot give recognition to the business.

Many charities don’t understand the rules regarding when something should be a sponsorship or a gift. They often ask for sponsorship when it is actually a gift or ask for a gift when it is a sponsorship. Many charity agreements on gifts and sponsorships also mix up these two concepts. Unfortunately, many businesses don’t understand these rules either. This can result in a lot of confusion and mistakes.
This course will provide an overview of the issues, including:
  1. Who can issue official donation receipts? What is a Qualified Donees vs Non-Qualified Donees?
  2. Where can you find the list of qualified donees?
  3. What is a “donation” or “gift”?
  4. What is a “sponsorship”?
  5. What are the differences between donations and sponsorships?
  6. When would one want to use a donation vs. a sponsorship?
  7. Why does a charity need to understand the distinction?
  8. What are some of charities and businesses’ biggest mistakes in this area?
  9. Can a charity give a “sponsorship” to another charity or a non-qualified donee?
  10. A discussion of numerous examples of donations vs. sponsorship?
This course will be of interest to charities, including their board members, fundraising staff and financial management personnel. It will also be helpful to businesses that make donations and/or give funds for sponsorship and their professional advisors who are considering how to have maximum impact with their gifts and/or sponsorships.

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