Canada: How Much Can You Give? A Primer On Political Contributions

With Ontario general elections approaching on June 12, 2014, Toronto municipal elections set for October 27, 2014, and federal nominations in full swing for the 2015 election, requests for political contributions have increased significantly. The following is a short summary of restrictions on political contributions by jurisdiction, and available credits and rebates.

ONTARIO ELECTION

Individuals normally resident in Ontario, corporations (other than registered charities) carrying on business in Ontario, and trade unions that hold bargaining rights for employees in Ontario may contribute money, goods or services to registered political parties, constituency associations, candidates and leadership contestants within the parameters set out in the Election Finances Act (Ontario Act). Under the Ontario Act, political contribution limits presently are as follows:

  • To each registered party: C$9,975 per calendar year, plus C$9,975 per campaign period, the campaign period for the election recently called in Ontario began on May 7, 2014 and ends three months after polling day
  • To each registered constituency association: C$1,330 per calendar year
  • To registered constituency associations of any one party: C$6,650 per calendar year
  • To each registered candidate: C$6,650 per campaign period
  • To all registered candidates of any one party: C$6,650 per campaign period

So if, for example, an individual was to donate the maximum amount to the party of their choice in contributions to constituency associations, registered candidates and the party itself, in an election year the total they could give would be C$19,950 to the party, C$13,300 to candidates and a further C$13,300 to constituency associations.

Monetary political contributions must be made out of the contributor's own funds and not from funds provided by another person or entity for the purpose of making a contribution. The provision of goods and services will in certain circumstances qualify as a contribution and be subject to the limits set out in the Ontario Act. The maximum permissible cash donation is C$25.

Where corporations are "associated" within the meaning of the Income Tax Act, and where one or both of those associated corporations does not carry on active business (again, within the meaning of the Income Tax Act), the associated corporations are treated as a single corporation and their contributions are counted together.

Political contributions to provincial candidates will be entitled to receive a tax credit in the amount of 75 per cent on the first C$399 of donations, 50 per cent on the next C$931, and 33.33 per cent on the next C$1,696. For amounts thereafter, no tax credit is available.

TORONTO ELECTION

Corporations and trade unions are prohibited by a City of Toronto bylaw from making political contributions to candidates for an office on Toronto city council. This bylaw prevails over sections of the Municipal Elections Act (Ontario) (Municipal Elections Act) which would otherwise permit corporations and trade unions to make political contributions. This prohibition applies only to candidates for an office on Toronto city council, including candidates for mayor. Contributions to school board trustee candidates by a corporation that carries on business in Ontario or a trade union that holds bargaining rights for employees in Ontario are permitted. In that case, corporations that are "associated" for tax purposes have their contributions counted together. The Municipal Elections Act limits an individual's political contributions as follows:

  • To each Toronto mayoral candidate: C$2,500
  • To each candidate (other than a mayoral candidate): C$750
  • To all candidates for office on the same council or local board (including a mayoral candidate): C$5,000

The maximum permissible cash donation is C$25.

An individual who is normally resident in Ontario may make political contributions to a candidate during that candidate's election campaign period, which typically begins on the day the candidate files a nomination for office and ends on December 31.

The Municipal Elections Act takes the same general approach to defining "contribution" as the Ontario Act, with a few minor variations, including application of the rules to the provision of goods and services to a candidate at a discount.

Cash contributions by Ontario resident individuals to municipal candidates will be entitled to receive a rebate (not a tax credit) in the amount of 75 per cent for the first C$275 over C$25, 50 per cent for the next C$700 and 33.33 per cent for remaining contributions to a maximum rebate of C$1,000.

FEDERAL NOMINATIONS

Political contributions to nomination contestants from anyone other than an individual citizen or permanent resident are prohibited under the Canada Elections Act (Federal Act). As is the case under the Ontario Act and the Municipal Elections Act, non-monetary contributions other than volunteer labour count toward an individual's contribution limits.

As nomination contests heat up across the country in anticipation of the 2015 federal election, individuals who wish to make a contribution to a nomination contestant may do so provided that the aggregate amount of that person's contributions over the 2014 calendar year to nomination contestants, registered electoral district associations and candidates of one registered political party is no more than C$1,200. Note that this is a global limit and not a per-candidate limit.
The maximum permissible cash donation is C$20.

Contributions to federal nomination contestants – unlike contributions to electoral district associations and registered candidates – are not eligible for any federal tax credit, even though they are subject to the same global limit.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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