LiveDifferent Builds is a fully charitable program. This means that “participants/travelers” are functioning as volunteers, approved by our Board of Directors, to help achieve the charitable purpose of LiveDifferent. The direct beneficiaries of this charitable program are families and people in-need in our host countries, not those who deliver the program (even though it may be incredibly fun, rewarding and even life-changing to serve others in need).
The humanitarian trip does not have a “personal recreational vacation” component that is more than incidental to the charitable project (eg. there are not multiple days of vacation free-time during the trip).
There is a fundraising goal/trip fee for volunteers. Due to the expense and logistics of coordinating a volunteer humanitarian development project, an important qualification is for each volunteer to meet a minimum fundraising goal. Volunteers can solicit tax receiptable donations via their fundraising page to reach the minimum fundraising goal and help pay for the costs in carrying out the project. Such contributions are received by LiveDifferent for its charitable purposes.
Builds fundraising generally qualifies for a donation receipt. According to the Canada Revenue Agency, a donation is a voluntary transfer of property without valuable consideration (an “advantage”) to the donor; donors cannot choose the beneficiaries of their donations, and a charity must have full discretion in deciding how to allocate its funds. All donations are given to the project/charity, and though donations help meet the volunteer’s fundraising goal and the costs associated with the charitable project, they are not being used as a direct monetary benefit to the volunteer (eg. monies won’t be refunded, they won’t be used to cover personal/recreational expenses, etc.).
This means that ALL tax-receipted donations are absolutely, 100% non-refundable, as it is not legal for a charity to refund a donation. In the event of any form of cancellation whatsoever or exceeding a fundraising goal, funds will instead be allocated towards where most needed in the project or in other charitable programs. In the event that a volunteer is unable to participate in the project, fundraising efforts may be taken into account when registering for a future trip, but this is exclusively the decision of LiveDifferent.
“Non-arm’s length” donations will get a split tax receipt for 60% of the donation. 70% (the percentage related to humanitarian project costs) of a donation from immediate relatives (eg. yourself, spouse, common-law partner, grandparents, parents, brothers, sisters, children, and grandchildren) will be tax-deductible, and 30% (percentage related to accommodation, food and travel) will not be tax-deductible. The reason we split receipts for immediate family member donations is because tax-receipting for personal (ie. recreational) travel is something that has often been abused/defrauded by charities or donors, and is of concern to the CRA. Although, as stated above, LiveDifferent Builds are structured to be fully charitable and not recreational travel, it is out of an abundance of caution that we split off any amount that could be misperceived by the CRA (as they lack clear guidance on this matter) as a personal benefit or advantage. This helps to protect both donors and LiveDifferent.
LiveDifferent will not issue tax receipts to non-arm’s length donors (ie direct family members) until after the end date of the trip. If, after fundraising, a volunteer subsequently receives insurance compensation for a trip cancellation, there is a risk that it could potentially constitute an “advantage” (a monetary benefit resulting from making a donation) to any non-arm’s length donors. This complex scenario can be easily avoided by issuing a tax receipt AFTER any potential advantage (eg. insurance compensation) is negated (due to the Build being completed).