Political Contributions

Posted by admin on Apr 26, 2011 in Personal Income Tax | 7 comments

With the Canadian Federal Election and Personal Income Tax deadline falling on the same day this year, being May 2nd, 2011, I thought I would write on the subject of political contributions.

Many people do not realize that when you financially support a political party in Canada, you will receive a deduction on your contributions to your political party of choice, so long as it is a registered party.

Provinces allow for a deduction amount as well, but here we will only focus on the federal deduction. This is how the federal deduction for political contributions work:

On the first $400 you contribute to a party, you will receive 75% tax credit. This means if you contributed $400 to a federal party, you will receive a $300 credit.

The next $350 you will receive a 50% credit on the contributions you made. In this case, if you contributed $750 to a federal party, you would receive $475 back on your tax return ($300 back from the first $400, plus and additional $175 back from the next $350 contributed).

Finally, any additional amount given after $750 but less than $1,275 you will receive a 33.33% tax credit. So if you gave $1,275 to a political party, you would receive the maximum $650 credit on your tax return ($300 back on the first $400, $175 on the next $350, and $175 on the final $525 given to a federal political party).

Support democracy, support a party you believe in, and when you donate to them, you get a handsome deduction on it!

Finally, go and vote May 2nd!

Seianna Financial Services provides tax services to Canadians (except Quebec). Call a representative to give you a free consultation over the phone. See your contact list.