Giving to charity, whether it be giving money or giving time, is great for the soul. It can also be good for your tax return, albeit there are some conditions that must apply.
When Volunteering Can be a Tax Deduction
Typically, volunteering your time will not earn you a tax credit, however, if you volunteered as a firefighter, or search and rescue team member, you may be eligible to claim your hours of service.
If you volunteered in this capacity for at least 200 hours in the year, you can claim $3,000 for the Volunteer Firefighters’ Amount (VFA), or the Search and Rescue Volunteers’ Amount (SRVA), but you can’t claim both. If you volunteered as both a firefighter and a search and rescue team member, you can combine your hours for both activities and claim the total hours toward one of the credits.
It’s also important to know that some provinces, such as Quebec, Nova Scotia, and Newfoundland and Labrador offer provincial Volunteer Firefighter Tax Credits too, some of which have been introduced on the heels of the Federal Tax Credit.
Eligible volunteer firefighting services with a fire department include:
- responding to and being on call for firefighting and related emergency calls as a firefighter
- attending meetings held by the fire department
- participating in required training related to preventing or suppressing fires
Eligible search and rescue volunteer services with an eligible search and rescue organization include:
- responding to and being on call for search and rescue and related emergency calls as a search and rescue volunteer
- attending meetings held by the organization
- participating in required training related to search and rescue services
To be eligible, a search and rescue organization has to be a member of the Search and Rescue Volunteer Association of Canada, the Civil Air Search and Rescue Association, or the Canadian Coast Guard Auxiliary, or its status as a search and rescue organization has to be recognized by a provincial, municipal, or public authority. Not sure? Ask your search and rescue organization, and they can tell you if your volunteering is eligible. You will need a certified letter from your organization stating that you volunteered for a minimum of 200 hours to claim the credit. Without this letter, you will not qualify.
Emergency Service Volunteer
If you work as a volunteer ambulance technician, a volunteer firefighter, a search and rescue volunteer, you will receive a payment from an eligible employer, such as a government, a municipality, or another public authority on a T4 slip. Your taxable portion will be shown in Box 14.
Box 87 shows the amount that is exempted from tax. If you provided volunteer emergency services for more than one employer, you can claim the $1,000 exemption for each of your eligible employers. If the authority employed you (other than as a volunteer) for the same or similar duties or if you choose to claim the VFA or the SRVA, the full payment is taxable.
If you qualify for the $3,000 Volunteer amount, you whether can claim this amount or the exemption in box 87 but not both.
Bill volunteers as a firefighter. He received a certified letter confirming the 200 hours of volunteer work he did last year. He also received a T4 with the following information:
Box 14: $65,000
Box 87: $1000
If he wants to claim the exemption, he will report $65,000 in line 10100. Since the $1,000 is already exempted from Box 14.
If he wants to claim the volunteer firefighter amount, he will claim $3,000 on line 31220 and he will add box 14 and 87 and claim $66,000 on line 10100
The CRA might ask you to provide certification from the fire department or the search and rescue organization to confirm the number of hours of eligible volunteer firefighting or search and rescue volunteer services you performed.
Completing Your Tax Return
If you are using TurboTax products, you do not have to worry about the calculations since the software will claim the best tax scenario based on your T4 information. The software questionnaire will guide you through this process. You will need to confirm that you are eligible to claim the volunteer amount.
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