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SEVERAL MONTHS ago, federal minister of national
revenue Carol Skelton warned Canadians to avoid certain tax shelter
arrangements. As the traditional season of generosity approaches, there is
evidence that caution is still called for.
An August 13 press release warned taxpayers “to
be wary of promotions of tax shelter gifting arrangements promising huge
tax savings.”
“If it sounds too good to be true, don’t
fall for it,” stated minister Skelton. She urged Canadians to
check with the Canada Revenue Agency (CRA) – which, she said, could
“help you recognize the types of tax schemes that are out there, and
to warn you about the consequences of participating in risky
investments.”
Langley-based certified financial planner Richard
Navarro is sounding the same warning. “Common sense,” he says,
“would tell you that when you donate one dollar to a registered
charity, you get a tax-deductible receipt for the same amount. But it looks
like common sense is not that common.”
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He is speaking from personal experience, he says.
“I have met people who had been sweet-talked into this gifting scam.
Some are church people who had participated in it to their financial
detriment – not to mention the tarnished image of the Christian
community.”
Navarro emphasizes that he is not urging people to
curtail their generosity. “We give to a favourite charity because we
support its objectives. Our donations do make a difference. When I served
for a decade raising funds and awareness for World Vision Canada, I enjoyed
challenging donors to give. Many were grateful for the opportunity to do
so.
“The tax-deduction is a bonus. The government of
Canada rewards the generosity of donors. Donors have a variety of ways, all
legal, to contribute, namely cash donations, life insurance, mutual funds,
stocks, et cetera – all for the benefit of those served by the
charities.”
“As Christmas approaches,” he concludes,
“let us give generously, but wisely.”
For CRA information, go to cra.gc.ca.
– DFD
December 2007
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