HomeMy WebLinkAboutFCS-13-171 - Donations Made to City-Related Organizations
REPORT TO:
Community and Infrastructure Services
DATE OF MEETING:
December 2, 2013
SUBMITTED BY:
Brenda Johnson, Director of Accounting, 519-741-2200
Ext 7647
PREPARED BY:
Brenda Johnson, Director of Accounting, 519-741-2200
Ext 7647
WARD(S) INVOLVED:
All
DATE OF REPORT:
November 18, 2013
REPORT NO.: FCS-13-171
SUBJECT:
Donations made to City-Related Organizations
RECOMMENDATION:
That for fiscal 2014, donations received by the City of Kitchener on behalf of City-related
organizations, namely Minor Sports Groups, Neighbourhood Associations and the KW Physicians
Group be redistributed to those organizations as intended by the donor.
BACKGROUND:
The City of Kitchener is authorized to issue donation receipts for income tax purposes when a
donation that legally qualifies as a gift is made to a municipality as per Section 110 1a of the
Income Tax Act. The City currently issues donation receipts for those who donate to minor sports
affiliated groups, Neighbourhood Associations, the KW Physicians Group, and the City of Kitchener
in general.
The City underwent an audit of donations procedures by the Canada Revenue Agency (the
CRA) in July 2013. For donation receipts to be issued to donors for these City-related
organizations, the CRA requires that all funds must be made payable directly to the City of
Kitchener and that any funds distributed to the City-related organizations must be approved
annually by Council.
REPORT:
In current practice, donations less than $500 are received directly by the City-related
organizations and the City issues donation receipts only after proof of deposit by these groups.
Donations greater than $500 are required to be made payable to the City of Kitchener and are
redistributed back to the group. Going forward the CRA requires that all payments must be
made directly to the City of Kitchener.
Staff are recommending that, effective January 1, 2014, Council approve that any donations
made directly to the City of Kitchener on behalf of a City-related organization be redistributed to
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the City-related organization in the manner they were intended. Without this approval, the City
of Kitchener will no longer be permitted to issue donation receipts for donations made to these
groups.
ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN:
This aligns with the Community Priority: Leadership and Community Engagement. The City of
Kitchener strongly supports the giving spirit of the community to all City-related organizations.
FINANCIAL IMPLICATIONS:
The change in procedure to receive these donations, reconcile accounts and issue cheques to
the City-related organizations will undoubtedly increase workload for City staff but it is
anticipated this can be accommodated within current staffing levels. This will be monitored for a
one year trial period to determine if any further process changes may be required as a result of
the CRA audit.
COMMUNITY ENGAGEMENT:
Inform.
ACKNOWLEDGED BY: Dan Chapman, Deputy CAO Finance and Corporate Services
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