Decision Date: April 9, 2014
Link: Case Summary Document
Citation: [2014] TCC 144 (Tax Court of Canada, Boyle, J)
Acknowledgement:The Pemsel Case Foundation thanks The Australian Centre for Philanthropy and Nonprofit Studies for its contribution in the drafting of this Case Note.


This Canadian case involved an appeal by a taxpayer (Hassan) who paid only $300 of a claimed $25000 donation to a charity called Operation Save Canada’s Teenagers. The $300 was paid in 2009 and the remainder was said by the appellant to be pledged for payment in 2010, although claimed for tax relief in 2009. The appellant said he then paid the remainder of his pledged $25000 in cash during 2010, taking the amounts to the charity in person.

There was no supporting proof of these payments, and indeed, the appellant had little or no knowledge of the alleged charity’s activities, or even the location of its head office, although he said that he drove there twenty times during 2010 to deliver his cash donations. Nevertheless, he obtained a donation receipt for $25000 for tax purposes in 2009. The receipt did not meet the requirements of Canadian tax law as to the information it contained. As His Honour said, in an ex tempore judgement at [9]):

Among other things, the wrong name appears; there is no identification of the location of where the gift was made, at least not one that is clear; it is in the wrong amount; and may also have at least one wrong date or missing date. In fact, one of the typos on the form is in the charity’s name.

His Honour said that this was clearly a fraud in the Canadian tax system, and indeed, on the Canadian public (at [12]):

A [Canada Revenue Agency (CRA)] charity auditor testified. The charity’s registration was since revoked, mainly for filing falsified documents on both donations received and charitable and other expenditures made. No records turned up to support any donations were given to CRA, or located by CRA on further investigation. Criminal charges were laid against the principal, who has since fled Canada.  The alleged fraud involved over $6 million in donations…All donors have been reassessed by CRA.

The appeal was dismissed with costs.

The case may be viewed at:

Implications of this decision

Under Canadian tax law, a pledge or promise to make a gift to a charity is not in itself a gift for which an official donation receipt can be issued. However, if the pledge or promise is later honoured, a receipt can be issued at the time of the donation is actually made.