If your material is approved for donation, several acquisition routes are normally available: give the material as an outright gift, sell it to the receiving institution as a purchase, or donate it in return for a tax credit or perhaps a tax credit and a capital gains exemption.

The authority to issue tax credits in return for donation was established to provide an incentive to Canadians to donate valuable cultural property to heritage institutions. This enables receiving institutions to focus their acquisition budgets on donors without taxable revenue.

A donor can actually receive two tax benefits from a single donation of AV records. The first is a tax receipt for a gift to charity and the second is a tax certificate which provides a capital gains exemption. The latter is issued by the Canadian Cultural Property Export Review Board (CCPERB) and only applies to those gifts valued at more than $3,000. Who decides what the donation is worth? Institutions approach this question according to their acquisitions criteria. In cases of major donations, an independent body of appraisers may be brought in to assess ‘fair market value’. How much would a combined tax credit/capital gains exemption mean in terms of money in the pocket? It may be best to consult an accountant. Sound complicated and confusing? It can be, but a detailed explanation can be obtained by consulting the CCPERBs website at: http://www.pch.gc.ca/progs/cebc-cperb/index_e.cfm . (The CCPERB web pages are found on the Canadian Heritage site, http://www.pch.gc.ca).

Although tax credits were designed to help heritage agencies acquire material, the process can be quite time consuming since the collection must be completely described so that an appraiser can assess it. Receiving institutions often do not have the staff resources to do this by themselves and may not be able to offer a tax credit option for this reason. However, in many cases, an arrangement can be worked out if the donor assists in preparing a description of the material being donated.