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If I receive a large sum of money (going towards helping fund athletics) from a person who is not family, does this count as personal income? I know there have been cases where people have been audited with monetary amounts gained on platforms such as gofundme.

  • Welcome new user ! – Fattie Nov 25 '18 at 14:19
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The CRA has a very clear statement:

Amounts received as gifts are not subject to tax in the hands of the recipient.

The issue, however, is in defining "gift."

  • Sometimes money is given to you but doesn't really belong to you. This is common within a family: mom and dad would pay a high marginal tax rate on the interest on their nest egg, but while you're a student with no income, you won't pay any. It's not really your nest egg in the meantime.

  • Other times a gift is really your income. Like a corporation just happens to give you the exact same cash gift every two weeks, and you do some volunteer work for them as it happens. Purely a coincidence, no? No.

  • and other times your gift or donation is really you selling something to a person. That doesn't make all of it income, but may create some real income.

What you're describing sounds like a scholarship and is therefore probably not income. But it matters whether the "not family" is the team you play for (you need a ruling on whether it's income or not) or a corporation sponsoring you for endorsing their shoes, or whatnot.

If it's enough money that the tax on it matters, get an opinion from the CRA. If it's a few thousand from a neighbour who hopes you'll win gold, you didn't ask for it, it's not an ongoing (monthly or yearly) thing, and it's not contingent on you doing certain things, then you can feel pretty confident you fit the definition of gift.

  • The amount is upwards of 50-60k as a sponsorship for flights, accommodations, race entries etc. The gift is coming from a friend that is not correlated to the sport. More of a generous gift to help fund the year. – Rachel2442 Nov 23 '18 at 20:38
  • @Rachel2442 The word 'sponsorship' concerns me. Will you be wearing branded clothing, etc? When Andy Fantuz got his name on a box of cereal, the money he received was also called a 'sponsorship', and I'm sure he paid tax on it. – Grade 'Eh' Bacon Nov 23 '18 at 21:17
  • Nope. No branding at all! – Rachel2442 Nov 23 '18 at 21:49
  • It’s just simply a friend giving me the allocated amount I need to pursue an athletic year. Which as stated above is for flights, accommodation, emergency expenses, transportation etc. – Rachel2442 Nov 23 '18 at 21:51
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    Note that the same link above notes that a gift is "really" a gift if: "(a) there is a voluntary transfer of property, (b) a donor freely disposes of his or her property to a donee, and (c) the donee confers no right, privilege, material benefit, or advantage on the donor or on a person designated by the donor." The one word there that concerns me is "freely"; it would seem to imply that the money has to be given without any conditions on how you'll use it. In other words, if the "gift" would be revoked if it wasn't used for athletics, it might not be a bona fide gift. – Michael Seifert Nov 24 '18 at 15:41

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