Resources for donors

The university encourages donors to make outright and/or deferred gifts. A description of the types of gifts accepted, the types of designations that donors can make and the principles that guide professional staff and volunteers in the gift planning process follow.

A. Donor Preferences

The University of Manitoba receives and administers gifts in accordance with donors’ instructions, insofar as they are within the guidelines set by the university from time to time. Gifts can be categorized as follows:

• Unrestricted Gifts are intended to promote and carry on the work of the university with no restrictions as to the use or administration of the funds.
• Designated Gifts are intended to promote and carry on specific work of the university with no further restrictions as to the use or administration of the funds.
• Restricted Gifts are gifts where, in order to meet donor preferences, the university agrees to undertake specific obligations in relation to the use or administration of the gift.

To ensure continuity and integrity of restricted gifts over time, designated or restricted gifts include language similar to:

In the event that circumstances make the specified use or purpose of this gift no longer practicable or desirable, the university is hereby authorized to make changes in its use in keeping as far as possible with the spirit and general intent of the gift.

To facilitate efficiency in investing and administering the funds, designated or restricted gifts should contain language similar to:

The capital and the income therefrom is to be administered in accordance with the university’s investment policies as amended from time to time.

Certain gifts require special arrangements by the donor and/or the university as follows:

B. Gift Planning Principles

Ethics

• University volunteers and professional staff help donors and their advisors to design gifts that meet each donor’s philanthropic and financial objectives within the context of the university’s needs. The university may inform, guide or otherwise assist donors who wish to support the university’s activities, but never under any circumstance should they pressure or unduly persuade. All professional staff and volunteers will conduct themselves in accordance with the professional code of conduct and ethics of their designating body or occupation. The university will not knowingly accept a gift that is contrary to each donor’s and/or the university’s best interests.

Legal and Professional Counsel

• Persons acting on behalf of the university shall encourage the donor to discuss the proposed gift with independent legal, financial and/or tax advisors of the donor’s choice, so as to ensure that the donor receives a full and accurate explanation of all aspects of the proposed charitable gift. The university is prepared to provide the donor a list of financial advisors, but encourages donors to find an advisor that satisfies their needs. At no time does the university warrant or certify the competence or integrity of any advisor.

Conflict of Interest

• In all matters involving the donor, the interest and well being of the donor must take priority. In cases of conflict of interest, those acting on behalf of the university must declare the conflict. A conflict of interest is deemed to occur when individuals who present themselves as representatives of the university attempt to sell their own product to the donor. However, if the individuals present themselves as representatives of an outside firm and part of their financial counselling involves arranging gifts for the university, no conflict would exist.

Confidentiality

• At all times, advisors working with donors or prospective donors to the university will keep all information, data, or other communications strictly confidential.

Eligible Amount: The amount that the fair market value of the property gifted exceeds the amount of the advantage, if any, received by the donor with respect to the gift.; The eligible amount is the amount claimed on the donor’s tax return.

Advantage: The amount of benefit of any kind that is received by the donor, or person not dealing at arm’s length with the donor, has received or is entitled to receive at the time, or in the future from when the gift is made. Furthermore, at no time can the advantage exceed 80 per cent of the total value of the gift.

Outright Gifts:Any corporate gift, or a gift of any type of property that is from an individual, that is received while the donor is alive and is readily available for use by the university.

Excepted Gift: A gift of privately held shares where the donor is at arm’s length with all directors, trustees, officers, and/or like officials of the university. A tax Receipt is issued for the value as at the date of the gift, not when it is received into the university’s account.

Deferred Gifts: A gift of any type of property that results from the death of an individual or requires a specified period of time to elapse before the property is available for use by the university. Therefore, deferred gifts include interests in trusts or similar arrangements.

In-kind Gifts: A gift of property that is not cash, or near cash.

Near Cash: Bonds, money market mutual funds, GICs, T-bills, and other short term investments that have readily available markets to convert them into cash.

Publicly Traded Securities: Shares, warrants, rights, debt obligations that are traded on a prescribed stock exchange, shares of the capital stock of a mutual fund corporation, a unit of a mutual fund trust, or an interest in a related segregated fund trust.

Prescribed Stock Exchange: An exchange listed in Regulation 3200 of the most recent version of the Income Tax Act of Canada. Generally speaking, any major exchange in Canada or around the world.

Insurance: Gifts where an insurance policy is purchased with the university as the owner, or ownership is gifted to the university at a later date (policy assignment), or the death benefit is assigned to the university as a beneficiary. A tax Receipt may be issued for the premiums paid only when the university owns the policy. The university will not own, or accept ownership of, any life insurance policy that is not a permanent policy (Term to 100, whole life, or universal life).

Death Benefit: Refers to the ultimate tax-free payout from the policy at the death of the insured. Death benefits can be guaranteed at an amount, or can vary over time as defined in the policy. At all times, payment to the university of the eventual death benefit ultimately destined for the university must be a certainty. In order to qualify as an eligible amount, the donor, and not the university, must own the policy.

Premiums, Life Insurance Premiums: Cash payment that is required to fund an insurance policy. Premiums are always required for the lifetime of the insured (or to age 100). However, depending on the type of insurance policy, the premiums may be paid by the donor on a regular basis, OR after a certain number of premiums have been paid, from funds accumulated within the policy (cash value).

Net Cash Surrender Value (AKA Cash Value): For the purposes of a gift, the amount of excess funds held within the policy – less any policy loans outstanding. Cash value normally accumulates in the early stages of a policy when the cost of insurance is less than the premiums paid. Over time, the cash surrender value may be withdrawn by the owner of the policy as policy loans, or used to fund the required premiums for as long as the cash surrender value remains in a positive balance. If the premium demand exceeds the ability of the cash value to fund it, the policy may collapse.

Policy Loans: Situations where the owner has withdrawn some of the cash value from the policy. Policy loans are repaid under a payment schedule with interest. If the owner refuses to repay the loan, the cash value will be used to repay the loan. If the cash value expires, then the policy will lapse. Tax Receipts can be issued for repaid policy loans when they are repaid after ownership of the policy has been transferred to the university.

Real property: For the purposes of this policy, refers to property that cannot be moved. In general terms, real estate (e.g., cottages, houses, buildings, and vacant lots).

Non-real Property: Property that is not considered to be real property (e.g., artwork, investments, machines, etc).

Capital Property: Includes all depreciable property and any other property (real and non-real) which if sold, would result in a capital gain or loss.

Depreciable Property: Property that is normally capital property, which is used to earn income from a business (i.e. a machine or rental property).

Personal use Property:With the exception of Listed Personal Property (see below), the university does not readily accept personal use property. Property that is owned primarily for personal enjoyment (e.g. household items, boats, cars, furniture, etc.) Such property is normally not expected to have increased in value; hence there is no capital gain or loss for the disposal of this type of property. A tax Receipt can be issued for the fair market value and personal property is deemed to have a minimum cost and fair market value of $1,000. Thus, any disposal (including gifting) of personal use property that has a value and cost less than $1,000 is a non-taxable event for CRA.

Listed Personal Property (LPP): A sub-set of personal use property that includes only the following assets:

• Prints, etchings, drawings;
• Paintings, sculptures, and other works or art;
• Jewellery;
• Rare folios, manuscripts, or books;
• Stamps; or
• Coins

The distinction between this type of property and personal use property is that LPP is expected to have gained in value. Thus disposal of it may give rise to a LPP capital gain or LPP loss. The minimum cost and fair value is $1,000 as with personal use property.

Canadian Cultural Property (Cultural Property): Any property that has been certified by the Canadian Cultural Property Export Review Board. Gifts of Cultural Property are subject to enhanced tax benefits.

Charitable Remainder Trust (CRT): A trust where the university is a beneficiary of the remainder interest in the trust. Such interest is paid to the university after a prescribed period of time has elapsed (including death of the income beneficiary/beneficiaries) and at no time may the capital of the trust be encroached upon by anyone.

Residual Interest: A residual interest is part of a property that is real property (e.g., building, land) that is left to the university at some time in the future. Typically such property does not produce income for the donor.

Beneficiary (Trusts, Life Insurance Policies, Registered Funds): The person for whose benefit the trust was created. For charitable remainder trusts, the donor is normally the income beneficiary (income interest) and the university is the capital beneficiary (remainder interest). The university may be the beneficiary of life insurance policies and hence is entitled to the death benefit. Furthermore, the university may also be named the beneficiary of RRSP or RRIF (registered funds).

A. Canada Revenue Agency's Definition of Philanthropic Intent

The Income Tax Act of Canada (the "ITA") defines a gift in sections 248(30) and (31). A gift is a voluntary transfer of property where the donor demonstrated donative intent. In most cases, donative intent exists when any advantage (benefit) received by the donor as a consequence of making a gift does not exceed 80 per cent of the total amount contributed.

A gift is made in any circumstance where all three of the conditions listed below are satisfied:

• A donor transfers some property, usually cash, to a registered charity and the university irrevocably accepts the gift.
• The gift is strictly voluntary. Legal obligation on the donor may cause the transfer to lose its status as a gift, or result in the value of the gift being reduced.
• The eligible amount of the gift is ascertainable.

B. Tax Credits

Canadians making charitable donations are entitled to tax credits that reduce taxes directly. Consult Development & Advancement Services for current information.

Canadian corporations and American taxpayers receive tax deductions. In most cases, the Internal Revenue Service recognizes Receipts issued directly by the university as tax deductible. In certain circumstances, gifts must be made through the University of Manitoba Foundation (see University of Manitoba Foundation USA Inc., section V B).

A. Cash, Near Cash, or Public Securities

Gifts of cash or securities that are readily marketable, and, to which no conditions are attached, are routinely accepted and administered by Development & Advancement Services.

B. Gift Appraisal and Acceptance Process

1. Prior Approval

All gift agreements requiring execution by the university shall first be reviewed and approved by the university’s Legal Counsel. Where substantially the same agreement is used repeatedly, only the proforma needs to be approved.

The university will assess the value, and decide whether to accept or reject the following types of gifts, in order to protect the interests of donors and the university:

• Gifts of real estate, shares in privately-owned companies, personal property, listed personal property, and any other property interests which cannot be readily appraised or marketed;
• Gifts involving trusts or interests in property;
• Other gifts to which conditions are attached or which may expose the university to potential liability.

2. Gift Acceptance Committee

Gifts that require outside professional appraisal or valuation, that may put obligations on the university, or expose it to potential liability, are subject to review by the University’s Gift Acceptance Committee (hereinafter “the Committee”) in accordance with the policies and procedures in this document. The Committee shall include, but not be limited to the following:

• Comptroller or designate;
• University Legal Counsel or designate;
• Vice President (Administration) or designate;
• Vice President (External) or designate;
• Dean/Director or designate of the faculty or unit to benefit from the proposed gift;
• Any other person, including external parties that can provide expert input for the Committee’s consideration

The Committee is responsible for assessing whether the terms of gifts are acceptable to the University of Manitoba, whether the University of Manitoba has the capacity to process and manage the gift and for ruling on certain gifts where policy application is unclear. In carrying out their responsibilities, the Committee will oversee the process described below.

3. Information Required Prior to Consideration of Proposed Gift

Before deciding to accept a gift, relevant information shall be ascertained, including:

• Description of the property;
• For property that is not: inventory of a business, publicly traded securities, real estate in Canada, or Canadian Cultural Property:
  1. Ascertain when the property was acquired by the donor;
  2. Ascertain how the property was acquired;
  3. Determine who previously owned the property;
• Purpose of the gift;
• Estimated fair market value;
• Income, expenses, encumbrances and carrying costs;
• Environmental risks or problems;Special arrangements for disposition requested by the donor.

Not withstanding property detailed above, prior to acceptance, gifts in excess of $100,000 may be referred to the Committee for any reason.

4. Acceptable Gifts

The University welcomes gifts that support the pursuit of its mission. Indicators that a gift is acceptable include:

• The university has a use or need for the gift or, when there is no immediate need, the gift is marketable.
• The gift and its accompanying terms are legal.
• The purpose of the gift is compatible with the work/priorities of the University of Manitoba or the unit for whose benefit the gift is intended.
• The size and/or benefit of the gift are not perceived to be disproportionate to the work or cost required to support/sustain the gift.
• There does not appear to be a physical hazard and/or liability concern associated with the gift.

5. Unacceptable Gifts

The university has the right to decline any gift that is not consistent with its mission. Gifts will not be accepted by the university that:

• Consist of property that has been assigned a tax shelter number;
• Violate any federal, provincial or municipal law;
• Create any fund to provide scholarships, fellowships, professorships, chairs or lecture series with restrictive clauses that would violate The Human Rights Code (Manitoba), or that reserve to the donor or his/her representative the right to designate the recipient or that do not meet academic criteria determined by the Senate;
• Commit the university to name a faculty, program or endowment fund, without prior approval of the Board of Governors or the Senate;
• Compromise the university’s academic integrity or interfere with the university’s academic judgment;
• As a condition thereof, require any action on the part of the university which is unacceptable to the university or violates university policies and regulations;
• Contain unreasonable conditions;
• Are gifts of partial interest in property, unless the university agrees otherwise;
• Are financially unsound or that would expose the university to liability or embarrassment;
• Rely on an appraisal or evaluation, provided to the donor by third parties, that is perceived to be inaccurate or unreliable.

6. Disposition Policy

In the case of gifts-in-kind, unless otherwise agreed by the university through the terms of the deed of gift, all such gifts may be disposed of under the following guidelines:

• Consultation with the appropriate faculty or unit representatives.
• The proceeds of a sale of the asset will benefit the university faculty or unit for whose benefit the gift was originally given.
• In the absence of such a beneficiary, the university will direct the proceeds.

A. University of Manitoba

Gifts for which the university issues charitable donation receipts (Receipts) must comply with applicable federal and provincial tax regulations.

Gifts of cash, near cash, cheques, credit card or negotiable securities to which no conditions are attached are routinely accepted and administered by Development & Advancement Services.

Any cash or cheques received by units other than Development & Advancement Services and requiring Receipts must be forwarded to Development & Advancement Services within one week. Development & Advancement Services must approve all other gifts prior to being accepted by the university.

Development & Advancement Services is responsible for:

• Issuing Receipts that are compliant with Canada Revenue Agency requirements;
• Coordinating the distribution of Receipts and related gift acknowledgment correspondence for gifts with an eligible amount of $18.00 or more;
• Acknowledging gifts of cash, cheques or credit card within a reasonable period of time (usually within 48 hours).

For gifts of publicly traded securities the charitable receipt amount will be determined by:

Electronic Transfer - If the donated securities are sold the day they are received into the University of Manitoba’s account at BMO Nesbitt Burns, the fair market value of the gift will reflect the actual gross proceeds to the University. If the donated securities are sold after the day they are received into the University’s account, the fair market value will be determined by reference to the closing market price on the day the securities were received into the account.

Physical Transfer – Once the donor has endorsed the actual share certificates over to the University of Manitoba, the fair market value will be based upon the closing market price on the day that the University of Manitoba received physical possession of the securities. 

It is the University’s preference for the donor to make a gift of securities via electronic transfer. It is important to note that transferring shares electronically between two different brokerage firms can sometimes take more than one business day, and during this time price fluctuations can occur. It is the University's policy to sell donated securities as quickly as possible. The University will not hold any security on a speculative basis.

B. The University of Manitoba Foundation USA Inc.

The university has an economic interest in the University of Manitoba Foundation USA Inc. (“the Foundation”) which is an Illinois Not-For-Profit Corporation incorporated in December 1989. The Foundation’s purpose is exclusively charitable, literary, scientific and educational and its activities include the promotion, encouragement, aid and advancement of higher education, research and training in the Province of Manitoba, in Canada and elsewhere. The Foundation is exempt from USA Federal Income Tax under Section 501(c)(3) of the Internal Revenue Code.

The Board of Directors of the Foundation is an independent board whose members direct and guide the Foundation’s actions. Members on the Board include, among others, certain senior staff of the University of Manitoba. The University of Manitoba, however, is one of many universities eligible to receive aid from the Foundation. The university must make application to the Foundation’s Board of Directors to request funds, which may or may not be granted. The university’s economic interest therefore is beneficial, as gifts and donations which are solicited by the Foundation may be transferred to the University of Manitoba from time to time.

Gifts are sent to the University of Manitoba Foundation USA under the following circumstances:

• Gifts from a person who has no direct connection to the university;
• Gifts from employers through a corporate matching program;
• Gifts from American corporations or companies;
• Gifts from American foundations (private or public); and
• Gifts from trusts.

C. Affiliated/Associated Organizations

The following organizations may issue tax Receipts under their own numbers:

• Alumni Association Inc.
• St. John’s College
• St. Paul’s College
• St. Andrew’s College
• The University of Manitoba Business School Foundation (The Associates Program)

D. Receipt Recipients

The general rule is to issue the Receipt to the actual donor of the gift. In the case of a gift by cheque or credit card, this is the person (or people) whose name(s) appear(s) on the cheque or credit card. In the case of a gift of cash, the university will refer to accompanying documentation to determine to whom to issue the Receipt.

Examples are:

• If a cheque is received from corporations, including holding companies, the Receipt must be made out to the corporate name on the cheque. The Receipt cannot be entered in an individual’s name;
• If a cheque or cash is received from a partnership or a proprietorship that is not incorporated, the owner(s) and the company are one and the same for tax purposes. Receipts may be issued in the individuals’ names;
• If a person purchases more than one dinner ticket and apparently collects from the other people who use the tickets, Receipts may be issued to each attendee, if so requested. If the purchaser is an incorporated company or organization, the Receipt must be made out to the company or organization;
• A person may make a contribution to the university through an honorarium, stipend or other remuneration being paid for services rendered to any organization. If the person chooses to have the stipend transferred directly to the university, the organization, not the person, is entitled to the Receipt. The person must have received the amount into income before being entitled to a personal tax credit.

E. Canadian Cultural Property

The Cultural Property Export and Import Act encourages Canadians to keep significant cultural property in Canada by providing incentives for Canadians who give this type of property to designated institutions and public authorities. At the present time, Art Gallery One One One and the University’s Libraries are designated to receive Canadian Cultural Property. In rare situations, other units may be able to accept such property. The unit must contact Development & Advancement Services for the designation process.

F. Date of Donation

For Canadian Cultural Property, the date of donation is the date on which the Canadian Cultural Property Export Review Board certifies the property. Property may be transferred to the university by a tentative agreement for the purposes of seeking certification. However, ownership remains with the donor until such time as the certification process is successfully completed. Once successfully completed, and a certificate is prepared, ownership of the property is formally transferred to the university pursuant to terms of the tentative agreement and the Receipt can be issued on that date.

For all gifts, most Receipts are sent within 48 hours of the arrival of the gift, although there are no regulations requiring the issuance of Receipts within a particular time frame. Canada Revenue Agency suggests that they be issued at least by the last day of February following the year during which the gift was made.

All gifts that are received by mail or similar common carrier after December 31 can be considered as given in the prior year, when the gift is postmarked in the prior year.

The “date of issue,” which appears on all university receipts, is the date on which the receipt was prepared.

G. Trust and Endowment Funds

1. Definitions

Trust funds are segregated accounts that may encroach on capital to fulfill the purpose of the fund as defined in the terms of reference. Endowment funds are segregated accounts in which the capital is invested in perpetuity and only the income is available to fulfill the purpose of the fund as defined in the terms of reference. 

2. Minimum Levels

a. Award Funds/General Funds:

For establishment of a new named trust or endowment account, a minimum contribution of $25,000, not including matching funds, is required.

b. Research Funds

Named general endowment fund: To name a new trust or endowment fund to support research, a minimum contribution of $10,000 is required. The income from the fund will be used for the general research purposes of the designated faculty, where it is needed most.

Named designated endowment fund: To name a new trust or endowment fund to support research in a specified area, a minimum contribution of $50,000 is required. The income from the fund will be used for the specified area of research within the designated faculty.

3. Fund Distributions

All funds that are otherwise distributable from an endowment will normally be reinvested as a permanent addition to the principal until the endowment is funded with the then-required minimum funding level for an endowment, or, is dissolved as provided in ii. below. In the event that the donor is unable to fulfill the pledge by the end of the five years, the endowment may be either dissolved or re-designated as follows:

i. If trust or endowment funds are less than the minimum endowment fund level, the endowment may be dissolved and the Dean or Director of the beneficiary unit shall have discretion to designate an existing endowment fund to which to transfer the funds, taking into consideration the donor’s original intent and, if possible, consulting the donor or donor contact.

ii. If trust or endowment funds are in excess of the minimum endowment fund level prescribed for the type of fund originally approved by the university, the endowment may be re-designated, based on the funds held and the donor’s intent.

4. Amendment or Termination

Once a trust or endowment is created, the terms, purpose, or existence of that fund may be changed if specifically authorized by the terms of the agreement or subsequent agreement with the donor, or applicable laws. In the case of student awards, requests for amendments to the terms or purpose of a trust or endowment or to terminate a fund must be sent to Senate Committee on Awards for coordinated review and approval.

H. Equipment Purchases

Receipts can be issued for contributions to a university account in order to purchase equipment that becomes the property of the university. If the equipment is related to a research contract or grant, different treatment applies. In such cases, contact the Office of Research Services. The procedure for gifts of equipment follows:

• The designated purpose for the equipment should be part of the general activities of the university for which donations would normally be accepted;
• Purchasing Services determines the cost of the equipment to be purchased. The person sends the donation to Development & Advancement Services, indicating the university account to which the amount is to be deposited;
• Development & Advancement Services deposits the gift in the designated capital accounts and issues a Receipt;
• The unit is advised of the gift and can make the purchase, to be paid from the appropriate university account;
• The thank you letter declares that the equipment is the property of the university.

The university will entertain “bargain sale” type arrangements combining gifts with proceeds to acquire equipment. At no time will the proceeds exceed 80 per cent of the total fair market value of the equipment.

I. Fundraising Events

Receipts can be issued for the charitable portion of ticket prices for university-approved fundraising events. The procedure is as follows:

• The difference between the purchase price of a ticket to attend a “dinner, ball, concert or show” and the fair market value of the associated food, entertainment, etc. received is considered to be the eligible amount.
• To calculate the eligible amount, the university considers that two payments have been received: one for the fair market value of admission and the second as a gift to the university.  The fair market value is determined by making a comparison to the regular or usual charge for attendance at a similar function or the estimated price that would have been charged. The Receipt is issued and the donor is recognized for the eligible amount only.

When determining the eligible amount of the ticket price for a fundraising event, the following rules apply:

• The value of all door prizes is averaged over the number of attendees to determine if any advantage is present. This amount (if any) is added to:
• The value of any promotional items such as pens, t-shirts, golf balls, etc. given to attendees. If the sum of the door prizes and promotional items is greater than 10 per cent of the ticket price, or $75, then the amount is considered advantage and must be added to the following:
• The retail value of the meal and/or entertainment; This final amount constitutes the advantage used to determine the eligible amount of the ticket price.
• If the advantage can not be ascertained, then no tax receipt can be issued. Furthermore, advantage includes all activities related to the gift. For example; an event features a lottery where you donate $150 and are eligible to win a trip valued at $500. The $500 value of the trip is advantage and must be subtracted off the individual’s $150 ticket price – thus no gift.
• If the event features a lottery, hole-in-one contest, a draw, or some other game of chance that attendees can enter voluntarily during the event, then no advantage is present.

GST is no longer charged on the determined fair market value of the ticket.

If the event features an auction where the retail (or fair market) value is clearly posted, a tax receipt can be issued for the difference between the “posted” value and the amount paid provided the posted amount does not exceed 80 per cent of the amount paid.

J. Gifts-in-Kind

Receipts may be issued for gifts-in-kind received by the university. In cases of gifts of real estate and tangible or personal property that is not readily valued or negotiable: refer to the applicable Gift Appraisal and Acceptance Policies and Procedures. General procedures for items that are readily valued are:

• For gifts valued at over $1,000, a professional, independent appraisal of the value of the gift is required prior to the issuance of a Receipt;
• Gifts-in-kind must be approved by the Trust and Endowment Officer in Treasury Services before Development & Advancement Services issues a Receipt;
• An internal appraisal is acceptable for gifts-in-kind valued at $1,000 or less, should the university have staff with the expertise to make the valuation;
• The university will not accept any property with a tax shelter number;
• The university reserves the right to refer any gift in kind to its Gift Acceptance Committee;
• In the case of gifts valued in excess of $1,000, donors are responsible for securing a qualified, reputable, independent appraiser to produce a well-documented appraisal to substantiate the Receipt. Donors are encouraged to select the appraiser and pay the fee. The university reserves the right to obtain and rely on a second appraisal, at the university’s expense, for the purpose of issuing a Receipt;
• For gifted securities in a foreign currency, the conversion is done at the university’s bank’s buying price for that currency on the date of the Receipt;
• The university does not normally accept gifts of art that it cannot appropriately steward and display. Such a gift may be accepted on the understanding that it would be sold and the proceeds directed as the donor wishes. Gifts of art require authentication. Appraisal by a member of the Professional Art Dealers Association of Canada (PADAC) or a member of an equivalent international association is the basis upon which Receipts are issued. Acceptance decisions rest with the faculty or unit to which the gift is offered or can be referred to the Gift Acceptance Committee;
• The university and the University of Manitoba Libraries accept gifts of books and manuscripts that enhance its collections. See The Libraries’ Gift Acceptance Policies for specific details.

K. Gifts of Service

Canada Revenue Agency expressly forbids the issuance of receipts for a gift of service. However, a receipt may be issued when an individual, or corporation invoices the unit receiving the service, receives payment for the service, and voluntarily returns some or all of  the amount of the payment to the university as a donation.

L. Replacement of Lost Receipts

To replace a lost receipt, the university can re-print the original receipt, or may, in some cases, issue a replacement. If a replacement is produced, the new Receipt must refer to the original Receipt number and indicate that it is a replacement.

M. Lotteries

In all cases, a payment for a lottery ticket or other chance to win a prize is not a gift for which the university may issue a Receipt.

N. Sponsorships and Research Contracts

In the case of sponsorships and research grants and contracts, sponsors or funders may receive Receipts to the extent that they receive no direct benefit from the payment, and a non-charitable Receipt to the extent to which they receive a direct benefit from the payment. For sponsorships, GST will be charged and invoices will be sent to sponsors. Non-charitable Receipts will be issued upon payment of the invoice.

In order to determine whether support is a donation or a grant, the following questions will be posed to the donor/research funder:

• Is there an expectation of receipt of a “scientific results” report i.e. data exchange?
• Is there a specific research proposal with a start date and end date for the project or program associated with the funding?
• Were the funds awarded through a competition?
• Does the corporation/organization require a Research & Development receipt as a tax benefit?

If the answer to any of these questions is “yes”, no charitable receipt is issued.

A guiding principle in determining if a charitable donation receipt should be issued is Canada Revenue Agency Interpretation Bulletin 110R3. Normally, charitable donation receipts for gifts of research may be issued to:

• Charitable foundations;
• Professional organizations;
• Individuals who are not the signing authority on the research account;
• Corporations where there is no tangible benefit to the corporation.

A. Accountability

Gifts to the university shall be reported in a manner consistent with the standards recommended by the Canadian Association of University Business Officers (CAUBO), the Council for the Advancement and Support of Education (CASE) and the Canadian Council for the Advancement of Education (CCAE).

Gifts to the university and accompanying correspondence are handled with discretion. Development & Advancement Services maintains records required by Canada Revenue Agency for Receipting purposes. Access to these records is restricted to appropriate staff in Development & Advancement Services and the Comptroller’s Office and senior executives of the university.

The university will not release the names of alumni, friends and donors to unrelated organizations.

The university will comply with any legal obligation to disclose names of donors and the nature of their gifts (for example, obligations that may arise under the Income Tax Act, the Freedom of Information and Protection of Privacy Act or other relevant statutes).

B. Trusteeship

The university encourages donors to make donations directly to the university to minimize the costs of investment and administration of trust and endowment funds. The university’s Trust and Endowment Funds are professionally managed and administered in accordance with The University of Manitoba Act and the University’s Investment Policy Statement as amended periodically.

However, where the donor wishes to establish a private foundation and requests that one or more university representative(s) act as directors of the Foundation, the Committee must approve of such appointments.

C. Investment

With regard to the administration of invested funds:

• Investments will be consistent with The University of Manitoba Act and The University of Manitoba’s Investment Policy Statement as it may be revised periodically.
• Pooled funds are held within the University Investment Trust, and the investments are managed by professional investment managers appointed by the Trust Investment Committee. The Endowment Investment Committee monitors the performance of the endowment fund managers.
• The university will provide donors of endowed funds with an annual financial report of their fund, and, in the case of student awards, appropriate information about the recipients of scholarship assistance if so requested.

D. Recognition

1. General Recognition Policies

Gifts to the university will generally be recognized as follows:

• All forms of recognition are respectful of donor wishes.
• Donations are recorded regardless of the size of gift and recognized, unless the donor requests anonymity.
• The university will undertake other such activities as may be provided for in accordance with stewardship and donor recognition policies and practices as they may be amended from time to time.

2. Receipting vs. Recognition Issues

It is important to differentiate between who is receiving the Receipt and who is being recognized for the gift. The rules regarding issuance of Receipts (Section IV D) do not apply to recognition. Recognition for a gift can be given to whomever the donor wishes (within reason). Some examples are:

• A person who sends a donation from a corporation or holding company is not entitled to a Receipt in his/her name but can be recognized personally for the gift.
• A person can make a contribution “on behalf ” of someone else. In this case the university would issue the Receipt to the person actually giving the gift, but recognize the person indicated by the donor.
• A company can make a gift and indicate that recognition should be given to an individual.
• An individual can make a gift and indicate that recognition should be given to a company.
• In all of the above situations, as long as the Receipt is made out as per the Receipt recipient guidelines, recognition can be given as per each donor’s wishes.

There are many gift-planning options. Development & Advancement Services staff works with donors and their advisors to design gifts that meet each donor’s philanthropic objective while maximizing tax and other benefits, and that meet the university’s needs. The following guidelines are established to ensure that gifts accepted by the university will be cost effective:

A. Bequests

Bequests have historically been the most frequent kind of deferred gift, and have contributed significantly to the building of institutional endowment funds. The encouragement of bequests is one of the highest priorities of the university.

Guidelines:

• Sample bequest language for unrestricted, designated and restricted gifts, including endowments, will be made available to donors and their lawyers to ensure that bequests are properly designated. Donors will also be invited to provide information about their bequest provision and, if they are willing, to send a copy of that section of the Will naming the university, or other documentation to assist Development & Advancement Services to determine the donor’s intent.
• Where the university is a beneficiary of an estate, the manager of gift planning, in consultation with the university's legal counsel, will communicate with the Executor and/or lawyer of the estate.
• Bequests to the university can be arranged through a will as a specific bequest or on a contingent or reversionary basis. Bequests can specify an amount, a portion or the residue of a person’s estate, or a property such as life insurance proceeds, stocks, bonds or other tangible assets. In the case of tangible, personal or real property, the acceptance policies and procedures covered elsewhere in this document apply.
• Since arrangements made in a will can be changed at any time, bequests are considered revocable, and as such, are not eligible for Receipts during the life of the donor.
• Receipts are issued to the estate of the donor upon transfer of the gift, which can be credited against taxes that may be due from the Estate.
• Unrealized bequests are not included in the university’s formal financial reports.

B. Canadian Cultural Property

The Cultural Property Export and Import Act (hereinafter “the Act”) encourages Canadians to keep significant cultural property in Canada by providing incentives for Canadians who give this type of property to designated institutions and public authorities. The university is designated to receive this type of property thus enabling the donor to receive the enhanced tax benefits described below.

Guidelines:

• The Canadian Cultural Property Export Review Board must certify such gifts as being of outstanding significance and national importance.
• Once certified, Receipts for Certified Cultural Property are issued at fair market value. The Receipt can be used as a credit against taxes due, not subject to the usual limitations. Any excess can be carried forward for up to five years.
• Certified Cultural Property is exempt from any capital gain. Capital losses can be deducted within specified limits.
• Although there is no minimum value for applications for certification, a gift valued at less than $1,000.00 may not result in a tax savings for the donor beyond that which the institution is able to offer through regular Receipts.
• For more information, donors should contact the Canadian Cultural Property Export Review Board and request a document entitled Applications for Certification of Cultural Property for Income Tax Purposes.

C. Charitable Remainder Trusts

The charitable remainder trust is a form of a residual interest gift. The donor ("Settlor") transfers property to a trustee who holds and manages it. Trusts are powerful and flexible planning tools. Typically, the income from the trust is paid to the income beneficiary, which is usually the donor or his or her family. The university is named the capital beneficiary of the trust and entitled to the trust’s remainder when the trust is collapsed, which is normally at the death of the settlor. When the trust terminates (either at the death of the income beneficiary/beneficiaries or after a term of years), the trust remainder is distributed to the university. As with all charitable remainder trusts, in which the university is named as a beneficiary, the Settlor is entitled to a Receipt for the present value of the remainder interest

Guidelines:

• The minimum amount required to establish a charitable remainder trust is $250,000.
• A charitable remainder trust may be funded with cash, securities or real estate.
• If the donor (Settlor) selects an outside trustee, the trust may be funded with any property of any value acceptable to the trustee.
• The university will not normally act as Trustee of charitable remainder trusts. If the university agrees to be the trustee:
  1. The income beneficiaries must be at least 75 years old; and
  2. If real estate is to be contributed, the real estate shall first be subject to a thorough review as described in Section VIII E Procedures for Gifts of Real Estate.

D. Gifts in Kind

Art

Donors may make gifts of privately owned art or other valuables. The university will not accept art or similar property that is registered as a tax shelter.

Guidelines:

• Gifts of art may be offered to the university itself or through the School of Art or other faculties or units.
• The university reserves the right to sell, display or store the materials at its sole discretion.
• Receipts are issued for the fair market value of the gift, subject to satisfactory appraisal.
• The university reserves the right to inquire as to the ownership of the property, the cost when acquired, determine when the property was acquired and by whom, and collect any other information that is essential to determining the correct eligible amount for the gift.

Books, Manuscripts, etc.

Donors may make donations of books, manuscripts and papers that are of interest and/or value to the university. Refer to the University of Manitoba Libraries Gift Acceptance and Administration policies, as they may be revised from time to time.

E. Life Insurance

There are various methods by which a life insurance policy may be contributed to the university. A donor may:

• Assign irrevocably a paid-up, permanent policy to the university;
• Assign irrevocably a permanent life insurance policy on which premiums remain to be paid;
• Name the estate as the beneficiary, with a bequest of equal value included in the will;
• Name the university as a primary or successor beneficiary of the proceeds.

Guidelines:

• Any of the above types of life insurance gifts are acceptable to the university.
• In the event a policy is contributed on which premiums remain to be paid, the university will pay the premiums, provided the donor makes equivalent contributions for that purpose. A Receipt will be issued for the amount of the premium.
• Should the donor choose to suspend premium payments, the university may either cash in the policy in exchange for its cash surrender value or continue to make the payments on behalf of the donor.
• When ownership is irrevocably assigned to the university, the donor is entitled to a Receipt for the net cash surrender value (if any) and for any premiums subsequently paid. If there are policy loans outstanding, donor repayment of the loans after ownership of the policy is assigned to the university are eligible for a tax receipt.
• When the Estate is named as beneficiary and a bequest of equal value is left to the university, a Receipt for the proceeds is issued to the Estate at the time the gift is transferred.
• When the university is named as a primary or successor beneficiary of the proceeds, a Receipt for the amount received is issued to the deceased for use on the final tax return. Insurance proceeds bypass the estate and are not subject to probate or other challenges on the estate.

F. Real Estate

Gifts of real estate may be made in various ways: outright, residual interest in the property, or to fund a charitable remainder trust. The following guidelines pertain to gifts of real estate in general. The Gift Acceptance Policies described elsewhere in this document apply. Where real estate is transferred to a charitable remainder trust, additional requirements of the trustee must be met. All gifts of real estate will be referred to the Gift Acceptance Committee for approval.

Guidelines:

• The university shall secure a qualified, independent appraisal of the property. The cost of the appraisal will be recovered from the sale of the property or from the unit that will ultimately receive the property.
  The donor must sign a “Letter of Intent” prior to any action being taken by the university. A Receipt will be issued for the appraised value (or present value of the residual interest computed on the appraised value, in the case of residual interest gifts). The university reserves the right to secure its own appraisal and issue a Receipt based on it.
• The university shall determine if the donor has clear title to the property.
• In accordance with its Gift Acceptance Policies, The university shall review other factors, including zoning restrictions, marketability, current use and cash flow, to ascertain whether acceptance of the gift would be in the best interests of the university.
• The university shall conduct an environmental assessment, which may include an environmental audit, and accept the property only if:
  • it contains no toxic substances; or,
  • they are removed or other remedies taken assuring the university assumes no liability whatsoever.
• The property will be disposed of pursuant to the “Letter of Intent”.

G. Reinsured Gift Annuity

The gift annuity is an arrangement whereby a donor transfers property to the university pursuant to an agreement authorizing the university to purchase a commercial prescribed annuity that will pay a stipulated amount to the donor. Funds in excess of the amount required for purchase of the commercial prescribed annuity are retained by the university and used for purposes specified by the donor and acceptable to the university. A tax receipt will be issued for the amount retained by the university provided the value of the payments to the donor does not exceed 80% of the total funds contributed.

Guidelines:

The university will not issue gift annuities but may accept property from a donor, pursuant to an agreement authorizing the university to:

• Use a portion of the property to purchase a commercial prescribed annuity paying a stipulated amount to the donor and/or other annuitant; and
• Retain the remaining assets for charitable purposes.
• The minimum amount the university will accept for a reinsured gift annuity is $20,000.
• The cost of the commercial annuity generally should not exceed 70 to 75 per cent of the total funds transferred in order to result in a significant gift for the university.
• The donor may designate the purpose of the gift (amount retained by the university) subject to the consent of the university.
• A commercial insurance company shall be selected, and the terms of the annuity contract negotiated by representatives of Development & Advancement Services.

H. Residual Interest Gifts

A residual interest gift refers to an arrangement under which property is deeded to the university, while the donor retains use of the property for life or a term of years. For example, the donor might give a residual interest in a painting and retain possession of it. All gifts of Residual Interests will be referred to the Gift Acceptance Committee for approval.

Guidelines:

• The terms of the gift and responsibilities for expenses shall be specified in a deed of gift executed by the donor(s) and the university.
• Pursuant to the terms of the Deed of Gift, the donor shall continue to be responsible for real estate taxes, insurance, utilities and maintenance after transferring title to the property unless the university, upon prior approval of the acceptance committee, agrees to assume responsibility for any portion of these items.
• The university reserves the right to inspect the property from time to time and to assure that its interest is properly safeguarded.
• The donor is entitled to a Receipt from the university for the present value of the residual interest.

I. Shares in Privately-Owned Companies and Other Business Interests

Donors may make gifts of privately owned shares and business interests. The university may accept these provided that the university assumes no liability in receiving them. In some instances, the corporation is willing to redeem privately owned shares, or other stockholders are willing to purchase them. All gifts of privately held securities will be referred to the Committee for approval.

Guidelines:

• In the case of privately owned shares, these may be accepted if they likely can be sold in the future to the corporation, other stockholders, or to others interested in acquiring the corporation. If an independent valuation of the shares is required, such services will be provided by a Certified Business Valuator (Certified by the Canadian Institute of Certified Business Valuators). The cost for such valuation will be paid by the donor or the unit that will benefit from the gift.
• The university will not accept partnership interest or proprietorships, as they are likely to expose the institution to cash calls or financial liability or have adverse tax consequences.
• A Receipt will be issued for the shares as follows:
  1. The value received when the shares are sold.