Proper receipting is important for any registered charity, and
failure to comply with receipting requirements carries with it
hefty penalties. For example, if a donation receipt includes
incorrect or incomplete information, a penalty of 5 per cent of the
eligible amount on the receipt may apply. A repeat offence within 5
years, increases the penalty to 10 per cent. If there is
deliberately false information, the penalty climbs to 125 per cent
of the eligible amount and if the penalty for issuing false
receipts exceeds $25,000, charitable status may be suspended for a
year. Registration may even be revoked for violating receipting
requirements.
A donor may only claim a tax credit where they have a properly
issued donation receipt. Donation credits denied due to receipting
issues may result in unhappy donors and reputational damage to the
charity.
