Summary: This guide explains the key international differences in recognizing a donation's date for tax purposes, ensuring administrators understand that the cutoff relies on either the date the donor gives up control (US) or the date the charity receives/receipts the gift (Canada/Australia). Note: Admins should be aware that Tax Statements should be generated no earlier than the 16th of January to include all giving from 2025.
Before You Begin
Understanding these distinctions is crucial for accurate year-end contribution statements.
Consult with a tax professional for compliance tailored to your specific jurisdiction.
Step-by-Step Instructions
1. Identify the Donor's Country: Determine the specific tax rules based on the country where the donor will claim the deduction (USA, Canada, or Australia).
2. Check the Gift Timing Rule: Verify the decisive factor for the donation date:
Country-Specific Donation Rules
| Country | Decisive Factor | Key Rule for Year-End | Source |
|---|---|---|---|
| United States | Date Donor Relinquishes Control | Online/Credit Card: Donation must be initiated or received by 11:59 PM, December 31st (in the donor’s time zone). Checks: Must be postmarked on or before December 31st. | IRS Guidelines |
| Canada | Date Charity Receives/Receipts the Gift | Normal Rule: Donation must be received (or postmarked by mail) by December 31st. Deposit Lag: If an electronic donation is made on Dec 31st but not deposited until January, it historically counted for the following tax year (though temporary extensions are sometimes granted). | Canada Revenue Agency Details |
| Australia | Date Charity Receives the Gift | Donation must be received before June 30th to be included in that financial year's deductions. | Australian Taxation Office (ATO) |
Troubleshooting & FAQs
My ACH donation was initiated on Dec 31st (US), but didn't clear the bank until Jan 4th. Which year does it count for? United States: The donation generally qualifies for the prior tax year (the year the donation was initiated or the check was postmarked), even if the funds take several business days to fully process.
We received a check (Canada) with a Dec 31 date, but it was postmarked Jan 2nd: Canada: The crucial factor is the postmark date. If the postmark is Jan 2nd, the donation counts for the following tax year, regardless of the date written on the check.
What if our financial year is different in Australia? Australia's financial year ends on June 30th. All tax-deductible gifts must be received before that date to qualify for that tax year.