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David,
A Canadian tax reduction program has been presented to me that claims a present return on cash of 45-59%. The concept is a "Gift in Kind" to a Canadian registered charity. Where you purchase a product at cost and you donate to a registered charity in which the charity in return issues you a tax receipt for the "Fair Market Value" of that product. My question is, "Is this a legitimate/Legal strategy to assist in reducing one taxes"?
JXXXXXXX
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david ingram replies:
If the CCRA does not attack the programs, you will get the tax deduction. However, there is no social, moral, ethical or business reason for participating in any of the schemes I have seen.
The Banyan system is a perfect example. In my opinion, the CCRA is doing a great disservice tot he Canadian Public by allowing this system to go ahead without attacking it from the getgo.
If they have arranged for art or drugs or any other product to be bought at greatly reduced prices, then that is the market value.
When they then donate the art or the drugs at an inflated price, it is an easily recognized artificial transaction to any thinking person.
Stay away from them. The CCRA has all the time in the world to come back and attack the system. think of Canon Business Systems and other Speed Reading Courses. Think of Angie Liott and the Income Tax Franchises and think of the guys in St Catherines with the tax franchises. Think of Columbia Software and another dozen software write offs that were reversed.
What you are asking about is a scheme. Schemes always get reversed sometime.
I have no problem that you or anyone can come up with the buy of the century and donate it to a charity at a greater price than you paid for it because you really did find that "one of a kind" special deal. However, as soon as more than one person can do it because someone comes along to put them together in multiples, I have a big big big problem and the CCRA will as well although it may take them five or six years to really get a handle on it.
David Ingram's US/Canada Services
US / Canada / Mexico tax and working Visa Specialists
US / Canada Real Estate Specialists
4466 Prospect Road
North Vancouver, BC, CANADA, V7N 3L7
Res (604) 980-3578 Cell (604) 657-8451
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US / Canada / Mexico tax and working Visa Specialists
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